Homebuy - no deposit?

brit1234

sturgeon wrote: »

Correct. This user likes to browse this forum, probably by searching for 'shared ownership' and make the same unfounded ridiculous comment about this being a scam wherever possible. It's complete rubbish.

But it is a scam, you can't get away from it. The scheme was designed by builders to sell at overinflated prices.

Each builder has to make a certain amount of properties classed as affordable. Now to get round this and charge overinflated prices they created both shared equity and shared ownership. In reality the homes aren't affordable in the conventional sense, its just a way to get people into debt milking them for as much money as they can.

Ideas like this, gift deposits, self cert fraud created this housing buble making it grossly inflated. Now as prices return to normal there will be a lot of people trapped in huge debt. It will also be a lot harder to sell.

If you are a first time buyer avoid this scheme and save a deposit enjoying the price falls as you save.

fairydiamond

Anyone looking into HomeBuy need to read everything carefully. After the first few years you have to start paying a fee of about £1000 a year to HomeBuy for 8 years. (Unless you pay them off) and this doesn't count towards the loan.

We looked into it recently with Stamford homes and decided it wasn't for us.

Salz

What is the interest rate that you have to pay in 5 years time? Is the loan from the Government the same rate of interest as the loan from the developer?
I'm sure there are people out there that it is helping, but I have to agree with Poppy and the others that it appears to be a way of keeping the prices high. If nobody could get mortgages, then maybe the developers would have to put their prices down, giving more people a chance of buying.

nic_hr

All i can say is that I am going through the process of Homebuy Direct and I have read everything thoroughly, researched positive and negative reviews, and sought out a lot of opinion about the scheme and I still firmly believe that this scheme is the best thing for me and partner to be doing right now and that it is most definately not a sham.

nic_hr

omen666 wrote: »

Could you get a house on this scheme if you had CCJ's? Or if you were a student at Uni with no CCJ's?

The eligibility criteria for this scheme is that you should be in permanent employment with a good credit history.

nic_hr

poppy10 wrote: »

And if mortgage rates double, which they may well do? What then?

Mortgage rates could potentially double at any time so what are we all supposed to do rent for the rest of our lives and live in fear of ever buying a property?!

Muhasib

Salz wrote: »

What is the interest rate that you have to pay in 5 years time? Is the loan from the Government the same rate of interest as the loan from the developer?
I'm sure there are people out there that it is helping, but I have to agree with Poppy and the others that it appears to be a way of keeping the prices high. If nobody could get mortgages, then maybe the developers would have to put their prices down, giving more people a chance of buying.

For HomeBuy Direct the interest rate on both the developer and government loans are the same rate, set at 1.75% initially in year 6 and then rising each year by the Retail Price Index measure of inflation plus 1%.

Muhasib

fairydiamond wrote: »

Anyone looking into HomeBuy need to read everything carefully. After the first few years you have to start paying a fee of about £1000 a year to HomeBuy for 8 years. (Unless you pay them off) and this doesn't count towards the loan.

We looked into it recently with Stamford homes and decided it wasn't for us.

Is this the HomeBuy Direct Scheme? It would depend on how much you had borrowed initially at 0% for years 0 -5. The idea is you start to 'staircase' ie payoff the govt and developer loan as the payback kicks in from year 6 although it is still at a low rate (1.75% initially )

poppy10_2

nic_hr wrote: »

Mortgage rates could potentially double at any time so what are we all supposed to do rent for the rest of our lives and live in fear of ever buying a property?!

The point is that interest rates currently are historical all-time lows. The Bank of England base rate has never been as low as it is now (0.5%). There's only one way rates can go from here, and they could easily double or more. You shouldn't make your plans for the future assuming that borrowing will always be cheap as it is right now.

tek-monkey

If you get a 10 year fixed rate you have plenty of time to plan for that. I can afford 12% I think, without compromising too much, but have locked at 5.3%. In 8 years I'l worry about whats happening, til then I'll just save what I can towards buying out the equity as and when possible.