My Choice Homebuy

Chris2685

I think that last post about sums it up... A heavily pregnant girlfriend and a plummeting property market are 2 major factors which made me decide it wasn't worth the aggro.

haziec

Northants_Simon wrote: »

Sorry, that isn't true at all. At the start you have the house valued in the survey. They then lend you whatever percentage, say 20%, £40,000. You then pay interest on £40,000 at 1.75%. Each year they review this inline with a price index, so you will pay slightly more each year.

The only time they value the house is when you want to sell or pay off the loan. They then value the house and you still owe 20% of the value, not the original amount you borrowed. So if prices go up you owe more, if they go down you owe less. In effect they share your equity. You can also pay back some of the loan in the same way, I think it's in mulitples of 10% from what I remember.

The least amount they will lend is 15% and the most is 50%. Beware that they do expect you to take out the most you can on a mortgage. This nearly tripped me up as I had to offer slightly more for my house than I wanted to simply because of how much I could borrow on my mortgage. So if you can borrow £200,000 they will expect you to borrow £200,000 and no less, they then top this up with their part.

Thank you for sharing your experience. As you say it has enabled you to buy something that you couldnt have done without the scheme. This is why our "kids" are interested. But we are going to do all we can to help work out if its worth it.
I thought the other poster was wrong about the amount fluctuating, so thanks for putting that straight. I

Its a good point you make about them not allocating the money until the last minute and a worrying point. Reading the blerb again that our daughter has, I think it might be allocated a bit earlier now than it used to be?
Did you use a solicitor recommended by their agent? I wonder if doing that would make it a bit easier ??

Wickedkitten

Northants_Simon wrote: »

We have three children and got a 4 bedroom house but with only 15% loan from Homebuy. The rest financed with our deposit and a mortgage.

Sounds like you have actually made it work well for you by having a large deposit and having a low equity loan :T

haziec

Wickedkitten wrote: »

Sounds like you have actually made it work well for you by having a large deposit and having a low equity loan :T

yes, I agree, I wonder if they set the amounts??? Maybe IF they go for it and its a big IF after what we have read (but they want to look into it at least) they could reduce the percentage the Gov is contributing??
They have quite a good deposit.
(also they are going to see another independent broker who they know and see if theres anything around, although he told them that the rate would be around 6%)

Northants_Simon

Wickedkitten wrote: »

Sounds like you have actually made it work well for you by having a large deposit and having a low equity loan :T

Yes, we have brought a lovely 4 bed detached with garage in a nice area. That extra 15% made the difference between buying a 3 bed (which would have been cramped with 3 kids) and buying a 4 bed. The amount borrowed on the scheme was under £30,000, which I intend to clear as soon as possible.

I think buying a house at the moment is fine if it's for the long term. We won't look at moving again in the next 15 to 20 years as our house suits our long term requirments. Where people become unstuck is when they buy something that later becomes unsuitable (like a flat and you then want a family).

Those that say it's better to rent, I wonder if they have rented long term (like 15 years)?

haziec

Northants_Simon wrote: »

Yes, we have brought a lovely 4 bed detached with garage in a nice area. That extra 15% made the difference between buying a 3 bed (which would have been cramped with 3 kids) and buying a 4 bed. The amount borrowed on the scheme was under £30,000, which I intend to clear as soon as possible.

I think buying a house at the moment is fine if it's for the long term. We won't look at moving again in the next 15 to 20 years as our house suits our long term requirments. Where people become unstuck is when they buy something that later becomes unsuitable (like a flat and you then want a family).

Those that say it's better to rent, I wonder if they have rented long term (like 15 years)?

Sounds nice Simon, hb and I consider ourselves very lucky that we have always had our own house and our wants the same before she has a family, they can get a 2 bed house with this help, without it they can only get a flat which would mean they would have to move again. Even if they have two children a 2 bedroom would do for quite some time to come.

Can you answer a question for me? Did they calculate the 15% ?? because they have provisionally told our daughter that they can have 50%, I would seem wise to have as little as possible.

You are right about renting, our daughter works in the rental market and the horror stories she hears have put her off. OK, if you get a good landlord you are fortunate, but with children its a shame for them if you have to move every year or so like some of our friends have done.
I am very sad that young people can no longer get council housing, all the stock is allocated so quickly and so much of it has been sold off now.

Chris2685

You've got to make up as much as you can from your own means (deposit + mortgage) and whatever that is they will add 15% to 50%.
So it depends what price they want to go up to as how much they will take in shared equity.

Chris2685

Northants_Simon wrote: »

Those that say it's better to rent, I wonder if they have rented long term (like 15 years)?

I would say it is better for me and my family to rent now, but I would not rent for 15 years... As soon as house prices become affordable for us (without these schemes) then we will buy.