Help to Buy Explanation
We give a Help to Buy explanation.
Help to Buy is the new scheme set up by the Government to give the housing market a kickstart. They hope that it will kickstart both the construction industry and also the UK economy. They are taking a risk that it just creates a housing bubble similar to the situation where we got into this mess in the first place.
However, contractors can take advantage of this. It is probably the best time to get a contractor mortgage. There is likely to be a ready supply of new buyers. The laws of Supply and Demand say that if you increase the Demand when the Supply remains the same then there is bound to be a rise in price of the product supplied, in this case UK houses.
Help To Buy
So, how does Help to Buy work?
It was brought in for new houses and flats only in the Budget this year. They were going to bring it in for older houses in January. However, they have now brought that forward to October. So it is ready to go now.
Lenders, previously, were insisting on deposits of 20% or more. So the Government are going to loan housebuyers 20% of the mortgage in a 5-year interest free loan. They guarantee the lenders 15% of the mortgage.
This means that lenders can offer 95% mortgages again. This obviously brings a host of new potential buyers into the market. Indeed it brings in far more first-time-buyers.
Among these are contractors. Tony Harris has been getting specialist contractor mortgages for years, now, at below market rates. He can now get first time contractors mortgage offers on their very first day of their very first contract. What’s more he can get them mortgage offers based on their daily rate annualised, i.e. Daily Rate x 5 x 48 x 4.
How to Apply
For a Help to Buy explanation or to apply for one of these specialist contractor mortgages click on Specialist Contractor Mortgages