Help to Buy Extension

aer290

I have heard that the ‘Help to Buy’ scheme is being extended for a further 2 years due to Covid19. 

Does this mean help to buy repayments that are due this year have also been extended? 

Thanks, Abi

[Deleted User]

The scheme has not extended yet, there are consultations about if it should be extended to new entrants beyond the provisional end date and to postpone the dropping of the price cap before that. This is for new entrants to the scheme only

The repayments are a totally separate matter, those people have already entered into a contract and it is already running, they have the first five years of payments at £1 pcm and then the interest repayments beginning in the first month of the sixth year. Firstly that will not be this year for everyone, only those who bought five years ago and no, that interest free period will not be extended. 

mr101010

Hi Abi, Where did you hear this? We had a house reserved back in March with a Sept 20 completion, due to Covid-19 delays it has now been pushed back to Feb 2021 so really hoping they do extend it!!

[Deleted User]

@mr101010
The current scheme runs until 31/03/21, the new scheme with lower and regionally applied price caps begins on 01/04/21.
If you wish to use the current scheme and will be above the regional price cap in the new scheme then you need to complete before that date.
https://www.ownyourhome.gov.uk/scheme/help-to-buy-equity-loan/
There are currently no changes planned to the HTB scheme beyond what has already been set in motion, although the house builders are trying to get the government to increase the threshold on the new scheme that is unlikely, to the point of being fanciful.

mr101010

@MadMattUK
The 31/03/21 deadline will not be a problem for us. The real problem is the ‘physical completion’ deadline of 31/12/2020, having spoken to Help to Buy houses have to be ready to move into by the end of this year. Very unlikely our house will be built by then due to Covid-19 delays. So at the least we are hoping for the December deadline to be removed so we can complete and still be eligible before the March deadline. 

[Deleted User]

@mr101010
It does depend where you are in the HTB cycle, they get really fussy about deadlines, approvals etc. however most of them only kick in when you completed the property reservation and PIF, progressing through the scheme then is fairly easy although very rigid, I did mine 22 days. I found the people who worked in the regional HTB very good when it came to their specific part of the process, but none of them had a good overview of the whole process.

From the point you receive the ATP you have three months to exchange, so I suspect that is what they are referring to, as you would have to have completed the purchase in three months, to finalise everything before the deadline. That would mean that the developer would have to commit to having the property ready by 31/03/21 without fail. 

Would you still be able to purchase under the incoming regional cap or are they too low for you and are you a first time buyer? If they are not too low and you are a first time buyer then that means there is no problem. 

If you do need to use the current scheme I would try and speak to the regional HTB office again, but first work out your full timeline with the builder. If you can get a commitment to an HTB reservation in December and then exchange in February 2021 then I believe that should be allowed.

mr101010

@MadMattUK
We are first time buyers but our house is above the new regional price caps so unfortunately we would not be eligible under the new scheme in April, so we really need the current scheme. We were about the sign and exchange contracts just before lockdown and the site shut, everything was in place. Thank you for your advice, I will do that. 

[Deleted User]

@mr101010
If you were at the point of signing contracts then they should hopefully not be that far off (no more than three months), house builders will be much more flexible when they know that if they do not get completed by a date they will lose the sale, especially with how slow the market will be for the next few years. Speak to them as well, lay it out to them, that if they do not complete under the current HTB scheme then it will fall through, I expect they will already be looking at ways to make sure those kinds of things do not happen.