Our response to the coronavirus outbreak

Help To Buy Is Changing

You can apply for the new scheme from 16 December 2020.

The existing HTB loan scheme ends on 31 March 2021.

From April 2021 the Help to Buy: Equity loan scheme is changing. It will be available to first-time buyers and the property value it can be used on will vary depending on the area you are purchasing your new home in.

The other major change is that each region will have it’s own price cap. The regional price caps for April 2021 – March 2023 are as follows:

RegionPrice cap for Help to Buy homes April 2021 to March 2023
North East£186,100
North West£224,400
Yorkshire and the Humber£228,100
East Midlands£261,900
West Midlands£255,600
East of England£407,400
London£600,000
South East£437,600
South West£349,000

Final reservations under the current scheme will need to take place by the 15th December. The new scheme comes into effect from April 2020 although you can apply for the scheme after Dec 16th 2020.

First-time homebuyers who are eligible for an equity loan can borrow up to 20% (40% in London) of the purchase price of a new build home. How much you can spend on your home will depend on which region it is in.

You pay a deposit of 5% of the purchase price of your new home at exchange of contracts and arrange a repayment mortgage of at least 25% of the purchase price of your new home.

You won’t be charged interest on the equity loan for the first 5 years. Interest fees start at 1.75% and rise each year in April by the Consumer Prices Index (CPI) plus 2%. You pay a monthly management fee of £1 for the life of the equity loan.

An equity loan is secured against your property in the same way as a repayment mortgage. You must repay the equity loan when you sell the home, pay off your repayment mortgage or reach the end of your equity loan term. But, you can repay all or part of the equity loan any time before then.

An independent financial adviser may be able to help you decide if Help to Buy: Equity Loan is right for you. Your home may be repossessed if you do not keep up repayments on your repayment mortgage, equity loan or other loans secured against it.

You can find out more about this change and how to apply on the Help to Buy website.