100% 1st time buyer mortgage

poppy10_2

michael1983l wrote: »

Ok lets run some figures......


My mothly rent is £650 quid,

My mortgage would be £550 quid

Are you comparing apples to oranges? How much is the house you rent worth, and how much is the house you would plan to buy? And what interest rate are you working on to come up with the £550 figure?

Cat695

michael1983l wrote: »

Absolute rubbish. There are at least 2 GOVERNMENT RUN schemes that do not rip you off. The fact on one of them you can buy a house with an equity loan and pay no interest at all if you raise the capital within 5 years to purchase it.






Please explain how this is a scam as I am struggling to see anything but posatives to it from a point of view of somebody who would never get on the ladder without it.

well if they can't raise a deposit how is someone going to pay it off in 5 years?

20k
30k
and in some cases 40k

robin_banks

If you can't raise a deposit, how can you raise captial?.

To buy costs £3000 ish with legal fees and mortgage costs, even without a deposit, regardless of which bonkers government shared equity/ownership scheme you go with.

Dan_1976

They are not a scam, its people going in to them not understanding how it works. People dont look ahead!

michael1983l

Cat695 wrote: »

well if they can't raise a deposit how is someone going to pay it off in 5 years?

20k
30k
and in some cases 40k

One some equity is in their property with a perfect repayment history they should have no problem re-mortgaging for the full amount. Its not that people can't afford to pay their mortgages, its that they can't afford to save their deposits thats the problem.

michael1983l

Dan_1976 wrote: »

They are not a scam, its people going in to them not understanding how it works. People dont look ahead!

That is the fault of the person, I know exactly what I am going into and know exactly how we will pay off our equity share after the 5 years are up.

Cat695

michael1983l wrote: »

One some equity is in their property with a perfect repayment history they should have no problem re-mortgaging for the full amount. Its not that people can't afford to pay their mortgages, its that they can't afford to save their deposits thats the problem.

remortgage their property.....so you end up paying out more in the end.

I can't see the point in having a mortgage and also another outgoing (to pay off the capital).

Unless you know your going to get that some of money with 5 years then you are going to be paying out more in the long run.

michael1983l

Cat695 wrote: »

remortgage their property.....so you end up paying out more in the end.

I can't see the point in having a mortgage and also another outgoing (to pay off the capital).

Unless you know your going to get that some of money with 5 years then you are going to be paying out more in the long run.

I don't think you quite understand the scheme.

the ownhome scheme lends you between 20-40% equity which is interest free for 5 years.

You pay the rest off as a mortgage and nothing to ownhome during these 5 years.

When these 5 years are up you should have made at least 10% of your own equity with a 5 years history of ontime payments.

At this stage you remortgage to take the rest of the equity meaning you pay ownhome no fees at all.

Even if you have to pay mortgage fees you have saved in 5 years of no interest on say 20-40% of the property.

Even so first time buyers will normally re-mortgage around this point anyway as there is normally much better deals available to them.


People seem to be basing their negative opinions of these schemes on myths as far as I can tell.

Cat695

michael1983l wrote: »

I don't think you quite understand the scheme.

the ownhome scheme lends you between 20-40% equity which is interest free for 5 years.so for 100k house 20k-40k

You pay the rest off as a mortgage and nothing to ownhome during these 5 years.but need to save up that 20k-40k so add 400quid a month to save for 24k (no interest applied in this case)

When these 5 years are up you should have made at least 10% of your own equity with a 5 years history of ontime payments.

At this stage you remortgage to take the rest of the equity meaning you pay ownhome no fees at all.so you end up paying more in the long run

Even if you have to pay mortgage fees you have saved in 5 years of no interest on say 20-40% of the property.a good point as long as you pay it back

Even so first time buyers will normally re-mortgage around this point anyway as there is normally much better deals available to them.


People seem to be basing their negative opinions of these schemes on myths as far as I can tell.

A question so I fully understand

If house prices fall do you still have to pay back the same as what you borrowed?? (not the mortgage)

michael1983l

Cat695 wrote: »

A question so I fully understand

If house prices fall do you still have to pay back the same as what you borrowed?? (not the mortgage)

no you pay back a re evaluation if you request it.


I don't understand how you end up paying more in the long run like you said.

Also you don't need to save that ammount as I explained just remortgage to cover it after 5 years.