'Help to Buy' with a large deposit?

efunc

Hi all,

I'm a first time buyer, I have £180k saved and am looking for a £350-400k property in London. I've popped into HSBC and been told they'd be willing to lend me up to £229k pending usual checks.

I haven't paid any attention to the Help to Buy scheme but in what way could I use it to purchase a mortgage, since I already have a 40-50% deposit?

A quick glance at this Guardian article piqued my interest.

"Only a small number of households will benefit from the scheme: those who already have a home, people with substantial savings and the few who can qualify for a mortgage of up to £415,150."

Any advice or suggestions? thanks.

ethank

Are you looking at Equity Loan or Mortgage Guarantee?

Why do you want to access the scheme?

efunc

ethank wrote: »

Are you looking at Equity Loan or Mortgage Guarantee?

Sorry, FTB and quite green. Equity Loan I'm guessing, but considering all options, and other options not yet considered!

ethank wrote: »

Why do you want to access the scheme?

I'm looking for all the help I can get. If there's help available that the government have provided I need to look into it. I've spent the past 8 years doing nothing but saving, and even still most houses around me in London are out of reach. The article suggests that this scheme could come to my aid. In what way?

ethank

Help to Buy Equity Loan is used to buy new homes from a registered developer.

Help to Buy Mortgage Guarantee can help you buy a newly built home or an existing property with a deposit of as little as 5%

You've worked really hard to save such a large amount of money, and should be proud of yourself. However, If you have a 40 or 50% deposit - you don't need the Help to Buy scheme. The schemes are designed to help people with very small deposits move.

If you are thinking you could use the scheme to top up the amount you can spend to buy a house, then I don't believe you can as if HSBC are only prepared to lend you £229k, and you want more mortgage to get a home, your issue is HSBC believe you cannot afford a mortgage above this level.

Help to Buy is about people who don't have a deposit, but will not support people who can't afford the home they wish to buy.

efunc

Thank you ethank, that was my reasoning too which is why I never paid HTB any attention. However that Guardian article states it is of benefit to those with large deposits, and I can't see the mechanism behind this assertion:

"The average house price in London is £437,000...... Few banks will stump up that much cash to first-time buyers, those most in need of Help to Buy. Only a small number of households will benefit from the scheme: those who already have a home, people with substantial savings and the few who can qualify for a mortgage of up to £415,150."

What can he mean??

MissE001

Hi efunc, think it might just be badly worded....95% of £437,000 (the quoted average house price in London) is £415,150

I think the article is trying to say it's unlikely that you wouldn't have a 5% deposit if you can qualify for a mortgage of £415,150

efunc

I see, thanks, very badly written! He specifically mentions "people with substantial savings" although that isn't explained at all, and is obviously not the same as those qualifying for a £415,150 mortgage.

All that HTB is doing from my position is encouraging lot's of FTB's to descend onto the market who didn't save a deposit and also encourage seller's to put their prices up by 5-10%!

Back to saving then..

amnblog

If you have a substantial deposit available (25% +) you cannot use the equity scheme as it is not designed for you.

The guarantee scheme is of no value to you as it merely effect higher loan to value mortgages.

Move on ... and stop buying the Guanrdian