New Government scheme

newguy321

Hello,

As announced on the Budget the government will be putting forward a couple of hundred million towards a scheme to help new home buyers. Now I am possibly interested in this scheme so i am just going to post it the way I have interpreted it. If you can see any flaws or have any opinions on why this is good or bad ideas please say.

So as i understand...

If i was to take the scheme on a house for £100,000

If i put a £5,000 deposit down the government would pay £20,000 towards the deposit from a loan i took from them. The other £75,000 would be my mortgage.

So, the government loan is interest free for the first 5 years and thereafter below the market rate of interest (predicted to be 1.75%)

So, if my mortgage of 75,000 had an interest of say 4% this is good because after the 5 years i would be paying 4% interest on 75,000 of my debt and only 1.75% on the other 20,000 of my debt.

Am I reading into this correctly and have I interpreted it right?

Can you see any floors with this scheme? Any advice would be brilliant

Yorkie1

This thread is already going on this subject. Have look to see if it answers your questions

https://forums.moneysavingexpert.com/discussion/3129050

newguy321

Well considering that thread is full of people slagging off the scheme with no actual hard fact i will stick with mine. Can anyone add any value to what i have said or find a flaw?

GMS

Not everybody is slagging off the scheme.

The nature of the site is that people express their opinions whether you think them right or wrong. There are many doom merchants on the site but this is the nature of the beast.

If you are only looking for answers which suit you then you are in the wrong place.

My own view is that if the scheme suits the individual then they should be sensible enough to make their own decisions.

newguy321

I dont want answers that simply suit me i am not stupid GMS.

I am simply after a second opinion on this with maybe some good and bad points, not being told only idiots will buy into this scheme and spend the rest of they're life in debt.