One of the most significant barriers to homeownership isn’t the lack of available housing; it’s actually
getting the deposit to afford a home in the first place. Getting a mortgage has just become more accessible, or at least, it has from those lenders that have the appetite for the risk. The 3 per cent stress test removal will allow more potential buyers on the market. However, with the average UK house price set at £250,000, it means that to even get a 90 per cent mortgage, a borrower would need to bring in at least £25,000. That is quite a sum of money to obtain, given the economy’s current circumstances. If you manage this feat, you need to keep the costs low, and a Conveyancing Cirencester based company like www.montpellier.legal can do that for you.
There are a few schemes around that can help. For example, the Help to Buy scheme from the government was an interest-only loan that is repaid, in full and with a high degree of interest, when you come to sell. Its repayment is not based on the original purchase price. It is factored into the price you sell it at. So, if you’ve borrowed £45k, you could be looking at paying the government back that plus an extra amount on top. The repayments are at low interest to start, then rise when you get five years in.
The other option is to look at shared ownership, where you pay the mortgage and rent to a management company or local council.