In the autumn statement of 2015, it was announced that first time homebuyers looking to buy in London would be benefitted from a boosted cap of the Help to Buy Equity Loan scheme.
House prices across the country are not even, and in the boroughs of London, the prices spike massively.
This means that as hard as it is for potential first time buyers to get a house elsewhere in the country, it is extra difficult in and around the capital city. The changes to the Help to Buy Equity Loan cap is one way the government is hoping to change this.
Reportedly being instigated on 01 February, the cap will rise from a 20% equity loan from the government, to a 40% loan.
With the scheme allowing new buyers to get as small a deposit as 5%, this means that the mortgage loan will only need to be 55%, a very low loan-to-value, giving first time buyers in the area a very good deal.
In addition, use of the Help to Buy ISA can help to boost savings as it can be used in conjunction with the Help to Buy schemes. Altogether, this can give a first time buyer a big boost up onto the property ladder.
The government websites say that the cap will be raised “from early 2016,” although the guardian claims the higher equity loan will be available from 01 February.
