Help to Buy Equity Loan - Scandal

poppy10_2

Help to Buy/shared ownership is most definitely a scam, designed to prop up housebuilding corporations and dupe unsuspecting first time buyers.

Plenty of people were warning about this from the start
https://forums.moneysavingexpert.com/discussion/3177256/shared-ownership-equity-is-a-scam

grumiofoundation

poppy10 wrote: »

Help to Buy/shared ownership is most definitely a scam, designed to prop up housebuilding corporations and dupe unsuspecting first time buyers.

Plenty of people were warning about this from the start
https://forums.moneysavingexpert.com/discussion/3177256/shared-ownership-equity-is-a-scam

I'm not a huge fan of help to buy but I don't really see how first time buyers are being "duped". The terms and conditions are clearly laid out, can't claim to be being duped/scammed if you don't bother to read them (when making the biggest financial decision of your life).

foxy-stoat

grumiofoundation wrote: »

I'm not a huge fan of help to buy but I don't really see how first time buyers are being "duped". The terms and conditions are clearly laid out, can't claim to be being duped/scammed if you don't bother to read them (when making the biggest financial decision of your life).

Same goes for other financial contracts, PCP, HP, PPI, secured loans & guarantor loans to name a few. One day folk WILL read the whole contract before signing.

molerat

The only scandal is the government fronting taxpayers money to help fuel HPI.

TripleH

For the benefit of the Op and anyone taking out any contract, ALWAYS read the contract before signing and ALWAYS ask if there is anything you don't understand. If you don't feel comfortable with anything in it, walk away.

If someone is trying to get you to sign a contract without giving you the time to read the terms properly or comes with the line 'if you don't sign today, you'll miss out' is most likely trying to sell you something dodgy. Sadly by signing the terms, you confirmed you understood the full implications of the contract you were signing.

norsefox

bigisi wrote: »

So you went ahead with something you didn't understand despite signing up for it and agreeing to the terms at the time and somehow this is someone else's fault?

Typical of the younger generation at the moment, always looking for someone else to blame even when the fault is entirely theirs.

I take umbridge with “younger” generation. As if previous generations haven’t been responsible for their own fair share of monumental mistakes despite all the information being readily available to them.

JimmyDC

Hello. Well, this seems to have started a storm.

Thanks for your replies, it seems that the majority believe that Help to Buy equity is perfectly fine and that it's ok for the government to profit from us. I'd be interested to know if that was your view on other matters that directly affect you. I take your points and appreciate the feedback. I'd be interested to know the average age is here. Likely you all have "worked hard all your lives" and "paid your taxes". I'm particularly offended by the comment about "typical younger generation" which highlights one of the many problems. Ask yourself what the average house price was when you got on the property ladder and compare it with the average wage, the increase hasn't gone up in proportion. This makes it very difficult to buy for younger people, hence why the average first time buyer is now 30. So take your grumpy self entitled rubbish elsewhere.

I take your point in reading the contracts fully, but have you every read the entire T's & C's of everything you sign and did you fully understand each article? I understood I was borrowing money and that there would be interest, I misunderstood that the percentage increased with the house value.

I'm not complaining the house value has gone up, but I don't want to move, the house is my home and I want to stay here. The increase in value has meant that what I thought I was buying my property for was false because realistically, to fully own the property I'd be paying a much bigger deposit than if I'd just taken out a separate loan for the deposit. In 2 years time I'll have to pay interest and those payments are purely on the interest, not to reduce the loan. We are also not allowed to pay the loan off in partial payments so we can't slowly reduce what the government owns. In most private equity loans, you can. So this to me is a method for the government to keep a hold of the value of my house. That is, in my opinion, the scam. Had I been able to slowly pay back what I'd borrowed, the amount I'd have to pay back would have been much lower. Currently, the amount I have to save up to avoid paying interest has gone from about £34k to £42-45k. A loan at 5% would have cost me about £8500 in interest.

I likely will have to remortgage, I appreciate your advice on that one and for your explanation. It was genuinely helpful and has put me at ease.

To other comments, I started the thread to seek advice, not to invite a bucket load of insults and trolling from people with nothing better to do than grump about young people. If you have anything constructive to add or information or advice, I'm all ears but please keep ignorant stereotypes and generalisation to yourself.

JimmyDC

bigisi wrote: »

So you went ahead with something you didn't understand despite signing up for it and agreeing to the terms at the time and somehow this is someone else's fault?

Typical of the younger generation at the moment, always looking for someone else to blame even when the fault is entirely theirs.

dealer_wins wrote: »

Dont think the OP will be back somehow!

Seems you were wrong.

[Deleted User]

JimmyDC wrote: »

Hello. Well, this seems to have started a storm.

Thanks for your replies, it seems that the majority believe that Help to Buy equity is perfectly fine and that it's ok for the government to profit from us. I'd be interested to know if that was your view on other matters that directly affect you. I take your points and appreciate the feedback. I'd be interested to know the average age is here. Likely you all have "worked hard all your lives" and "paid your taxes". I'm particularly offended by the comment about "typical younger generation" which highlights one of the many problems. Ask yourself what the average house price was when you got on the property ladder and compare it with the average wage, the increase hasn't gone up in proportion. This makes it very difficult to buy for younger people, hence why the average first time buyer is now 30. So take your grumpy self entitled rubbish elsewhere.

I take your point in reading the contracts fully, but have you every read the entire T's & C's of everything you sign and did you fully understand each article? I understood I was borrowing money and that there would be interest, I misunderstood that the percentage increased with the house value.

I'm not complaining the house value has gone up, but I don't want to move, the house is my home and I want to stay here. The increase in value has meant that what I thought I was buying my property for was false because realistically, to fully own the property I'd be paying a much bigger deposit than if I'd just taken out a separate loan for the deposit. In 2 years time I'll have to pay interest and those payments are purely on the interest, not to reduce the loan. We are also not allowed to pay the loan off in partial payments so we can't slowly reduce what the government owns. In most private equity loans, you can. So this to me is a method for the government to keep a hold of the value of my house. That is, in my opinion, the scam. Had I been able to slowly pay back what I'd borrowed, the amount I'd have to pay back would have been much lower. Currently, the amount I have to save up to avoid paying interest has gone from about £34k to £42-45k. A loan at 5% would have cost me about £8500 in interest.

I likely will have to remortgage, I appreciate your advice on that one and for your explanation. It was genuinely helpful and has put me at ease.

To other comments, I started the thread to seek advice, not to invite a bucket load of insults and trolling from people with nothing better to do than grump about young people. If you have anything constructive to add or information or advice, I'm all ears but please keep ignorant stereotypes and generalisation to yourself.

As kingstreet asked; did you at the very least read the HTB Buyer's Guide before proceeding? Did you read the Personal Worked Example sent to you by the HTB Agent with the Authority To Proceed?

I honestly don’t know why you’re feeling so hard done by. It’s called an “equity loan” and it based on the equity, not the original purchase price. You were able to purchase a home that you not have otherwise been able to afford. You have have benefited from having lower interest rates due to a lower LTV thanks to the equity loan. You have now benefited from HPI by gaining tax fee equity from doing absolutely nothing. What is there to grumble about?

[Deleted User]

Look at the HTB website: https://www.helptobuy.gov.uk/equity-loan/equity-loans/

How much more simply do you think it can be explained?