Will The Government Backed Mortgage Guarantee Scheme Help You?
With raising funds for a deposit one of the biggest challenges for prospective house buyers, it is good to know that there is help on offer. The Government backed mortgage guarantee scheme is of benefit for many buyers, but is it of benefit to you?
The criteria of the scheme is based on:
- Buyers can purchase property valued up to £600,000 with a 5% deposit
- The scheme is open to first-time buyers, and existing homeowners
- The scheme is not limited to new-build property, it can be used on all manner of property
- The scheme aims to help buyers by incentivising lenders to provide more affordable mortgages to more buyers
If you fit in the criteria, you have a good starting point for assessing whether this scheme is good for you. You will know yourself the challenges you face in buying property, and if the deposit looks to be too daunting a task.
It is also important for vendors to know this scheme helps them. Anything which increases the number of prospective buyers is good for sellers. Therefore, you might not benefit personally from the scheme, but it could make it easier for you to make your next move.
Do you need help with your next move?
Robert Jenrick, Housing Secretary, comments: “For too many people, no matter how hard they work, homeownership can seem out of reach. One of the biggest divides in our country has been between those who can afford their own home and those who cannot. That’s why we are determined to do everything we can to help hard-working families and prospective first-time buyers get their feet on the housing ladder in an easy and affordable way, to level up this country. The new mortgage guarantee scheme which comes into effect today will give providers the confidence to lend and help families and young people get on the property ladder without the prohibitive burden of a large deposit.”
The Housing Secretary concluded by saying; “Despite the challenges faced over the past year, the government has intervened to protect jobs, support builders and buyers to help keep the housing market healthy. Today’s 95% mortgages launch further strengthens our commitment to build back better from the pandemic. In recent years we’ve reversed the trend and seen a positive increase in owner-occupiers. We’re determined to build on this through the range of flexible ownership options which help ensure homeownership is achievable. We want to match the ambitions of aspiring homeowners up and down the country. Together we can turn ‘Generation Rent’ into ‘Generation Buy’.”
We can assist you in the housing market
Tim Bannister, Rightmove’s director of property data, says: “The new mortgage scheme could help some first-time buyers bring their plans forward if they have a lower deposit but are still able to pass the affordability checks, and will be welcomed by those who last year we’re struggling to come up with a 15 or 20% deposit. Although the number of new properties coming to the market is improving, it’s still nowhere near enough to satisfy the buyer demand that is already at record levels, and so more people choosing to trade up will be vital to open up more choice at the start of the property ladder.”
Tim Bannister also said; “The combination of not enough stock and high demand will help underpin prices, and over the past five years asking prices of a typical first-time buyer home have already increased by £23,000 on average, so those who can now afford to buy a home will be trying to make the move quickly in case prices rise further.”
At Prestige & Village, we care about our community, and supporting others. We aim to provide you with as much help and assistance as we can. If you have any property or housing questions, please feel free to contact us today.Back to inspiration