New Mortgage guarantee scheme

Gymbob

Hi there, i'd just like to confirm as I cant find this anywhere and the people I talk to from different branches are useless and don't seem to have a clue about anything.

Is the guarantee only accepted on people up to a deposit of 20%... for example if you put a 5% deposit down, will the government loan the 15% left? then 10% is both... etc. But if you put a 20% deposit down do they not give you anything?

Or, can you put a 20% deposit down and still borrow a 15% loan?

The reason I ask is that because my salary isn't high enough I cant borrow more than 71k due to also being a student. But I have saved up a 20% deposit on the (113k house) so that's why ideally I need the scheme to allow me to borrow over that deposit. But no where seems to know....

johannalf88

The mortgage guarantee makes 95% mortgages more prevalent, and the government underwrites 15%, so the banks are only risking 80% (as I see it).

It will not allow you to get more money from the bank, or provide you with a larger deposit.

Are you getting confused with the mortgage guarantee and equity loan?

Gymbob

a little, but the house I intend to buy is a new house but has been bought and lived in for 3 months... which I think means technically it isn't a 'new house' anymore therefore I cant buy it under the equity loan.

So you are only allowed to borrow a sum up to the 80% then?... which is useless for me ....? If im putting a 20-25% deposit down which entitles me to nothing?

johannalf88

I'm not entirely sure if that still counts as a new build- it might. But the help to buy scheme for new builds is completely different to the mortgage guarantee which is what you have asked about.

You will not get the equity loan (which is only for new builds) if you have a 20% deposit.

I have heard apparently it is VERY hard to get mortgage for a house that has been brought with in the last 6 months too btw.

witchy1066

if you can afford to put 20% deposit the scheme would be of no use to you, its basically for people with only 5 to 10%

no scheme will allow you to borrow more than you can afford,

if you have been told you can only borrow 71k this would not change under any scheme, its worked off your income and affordability,

I would presume your income is around 20k , if I am correct you need to be looking at cheaper property as you simply cannot afford to buy at the price you quoted

Gymbob

with the equity loan:

it needs to be a new build..
can you get a loan interest free up to 20%?
can you put any cash deposit down you like? (as long as its over 5%)
have to be first time buyers

?

johannalf88

witchy1066 wrote: »

if you have been told you can only borrow 71k this would not change under any scheme, its worked off your income and affordability,

I was having a look at the help to buy MG mortgages the other day, and on some bank calculators the amount they would lend actually dropped when I only marked a 5% deposit- so it can change- just not the way you would like! :rotfl:

Gymbob

so with the guarantee (they will not give me anything after 20%+ deposit so that's useless)

And with the equity loan (its not longer a new build but if it was the government would lend me up to 20% of the house price + my deposit meaning I could get a 60% LTV mortgage but arnt there specialist rates with this not the usual amounts. like 5.04% instead of like a 2% which a 60% LTV would be)?

amnblog

It sounds like you may be confusion the two types of scheme.

Our Youtube account has 3 X 1 minutes videos explaining the H2B schemes.

PM me if you want a link to them.

witchy1066

johannalf88 wrote: »

I was having a look at the help to buy MG mortgages the other day, and on some bank calculators the amount they would lend actually dropped when I only marked a 5% deposit- so it can change- just not the way you would like! :rotfl:

yes I agree , it will only go one way :rotfl:
which I think will disappoint some people but with only a 5% deposit its a wise move , in my opinion,

OP HTB equity loans are only available for new builds , as far as I know , plenty of information in the internet and on this forum , do a search,

but regardless, your affordability will not change

johannalf88

Yeah, I can see why it is done.

This is why I can't really see how the MG can raise house prices... Banks are offering less not more!