HTB Equity Loan and mortgage providers

stalkah

Hi All,

Just after some advice as we're starting to look at new homes and hoping to take advantage of the government htb equity loan.

My biggest question is regarding mortgages and how much we could borrow and realistic costs.

Now I know since MMR the amount we can borrow varies wildly between lenders but what I can't seem to find is a clear answer on how lenders view the equity loan, do I fill in their "how much can I borrow calculator" saying I need a LTV of 75% and the deposit is 25% or do I say it's 5% deposit but at a lower property value?

Next question - the HTB it says to contact them once you have the mortgage details and they will do affordability checks and pass you on that. I can't see anywhere that mentions they do credit checks? Would you therefore assume that if we get a mortgage AIP and we're not being stupid on affordability the HTB wouldn't then turn us down on credit score?

And one final question when does a previous home owner become a first time buyer? We're currently in a rented house but I own another which is currently in the process of being sold. We are possibly not looking to move for another year as frantically trying to save enough for a deposit.

I know speaking with a broker directly would probably answer everything above but as we're not in a position to move yet I didn't want to waste their time.

Many Thanks in Advance

kingstreet

HTB - Equity Loan is newbuild only.

The HCA Help To Buy Agent uses a calculator to work out what's affordable. It does not do credit checks.

You should get a mortgage agreement in principle before you reserve. Once you reserve, you will complete your property information form and it is sent to the HTB Agent with the reservation. We send them in for our clients, with a copy of the Affordability Calculator and mortgage term.

When using a lender's affordability calculator, input 3% of the equity loan as an expense if it it does not mention shared equity. Eg - Halifax and NatWest don't, Nationwide does.

It's a min 75%/20%/5%, so enter the 75% as the mortgage amount and 25% as the deposit, unless it says different.

You are never a first time buyer again. However, some lenders will allow you a FTB product if you have not owned or held a mortgage in x years. Check.

FWIW you can never use Halifax for an HTB - EL purchase if you have ever owned a property now.

Essential you consult a broker on this. There are many pitfalls in the HTB - EL and newbuild arena.

stalkah

Thanks Kingstreet,

That pretty much covers everything I needed to know, we will definitely be using a broker just didn't want to approach one just yet as it's still early days but had a lot of questions

Just one other question thinking about the FTB, my wife has never been on a mortgage or owned a home but I have. As it'll be a joint application would we still not be classed as FTB's?

kingstreet

AFAIK all the HTB - EL lenders want both applicants to be FTB, otherwise you're classed as a "HomeMover."

Fruit_and_Nut_Case

American :spam: from freeze343

JPB123

kingstreet wrote: »

AFAIK all the HTB - EL lenders want both applicants to be FTB, otherwise you're classed as a "HomeMover."

My Halifax BDM confirmed they will do it as long as one applicant is an FTB. I live not far from you, so we've probably got the same BDM.

I am an Independent Mortgage Adviser

You should note that this site doesn't check my status as a Mortgage Adviser, so you need to take my word for it. This signature is here as I follow MSE's Mortgage Adviser Code of Conduct. Any posts on here are for information and discussion purposes only and shouldn't be seen as financial advice.

kingstreet

JPB123 wrote: »

My Halifax BDM confirmed they will do it as long as one applicant is an FTB. I live not far from you, so we've probably got the same BDM.

Steph?

Yes, one borrower has to be a FTB usually but will Halifax lend on HTB - EL when one applicant has owned a property before?

JPB123

kingstreet wrote: »

Steph?

Yes, one borrower has to be a FTB usually but will Halifax lend on HTB - EL when one applicant has owned a property before?

Yes, and no, Emma, not Steph

I am an Independent Mortgage Adviser

You should note that this site doesn't check my status as a Mortgage Adviser, so you need to take my word for it. This signature is here as I follow MSE's Mortgage Adviser Code of Conduct. Any posts on here are for information and discussion purposes only and shouldn't be seen as financial advice.

kingstreet

We're based in B73, which is now Steph Bister.

Previously we came under Martin Degg.