Are we trapped with Help to Buy (2)?

edam

A couple of years ago we were lucky enough to buy a 2 bed house as first time buyers with the help of H2B Mortgage Guarantee, as we only had a 5% deposit. Without it, I imagine we would still be renting.

A lot has changed since then. At the time of purchase we just hoped to get on the property ladder and move on down the line. But now, following changes in circumstances, in the future we would like to move to a bigger property and should hopefully be able to do so off our own backs.

We would like to continue to own the current property and rent it out or use it to provide for other family members.

Is it possible to do this? I know that at the time we signed a declaration saying it wouldn't be a buy to let property and that we don't own other property. I know you can't use H2B if you owned other property at the time, but what about property after the event? Can you purchase a further property, or inherit, or receive a gifted property?

If we cannot let it out currently, is there a way to be released from the H2B restrictions? Essentially there must be a way to release the government from its promise to the mortgage company to guarantee the 15% that it has?

Thanks.

ACG

There will be lenders who will allow you to take out a new mortgage with that property being let out. But you would not be able to use help to buy on the new mortgage, the rent would need to cver the mortgage etc.

You should really be obtaining consent to let for the current mortgage but I do not think that will be forthcoming so you would be breaching the rules of yor mortgage.

If you intend to do this without a broker then I would suggest you do your research thoroughly before applying to any lenders. You need to find out their stance on the current property. Your options will be fairly limited but that does not necessarily mean higher rates. I have done something this month (the offer should be issued tomorrow) and on a 3 year fixed rate with a 10% deposit the rate was 3.8%... So it can be done.

edam

Thanks for the reply.

I could just not be looking in the right places, but information seems to be scant out there.

As a further question, say we remain in the property but seek to remortgage the property with a new lender (not a H2B Mortgage, but a 'regular' mortgage). Is that possible under H2B and if it is, after the new mortgage with the new lender is completed, would we then be 'out' of the H2B scheme, so to speak?