Everyone who WON’T be able to use Boris Johnson’s new Right to Buy scheme – and other help available | The Sun

BORIS Johnson's announcement that housing association tenants will be able to join the Right to Buy scheme will be welcome news for millions of aspiring homeowners.

His speech has been seen as a nod to Tory rebels he is getting on with the job following a bruising confidence vote on Monday night.

During the speech, the prime minister also suggested mortgage deposits could be reduced across the board to help more people onto the ladder.

But plenty of people have been left out of this latest promise of help.

If you are one of tens of millions who doesn't live in a housing association property or council home and still need help getting on the property ladder, you may find yourself struggling.

However, there is help out there if you are finding it hard to save for a new home and aren't eligible for the Right to Buy scheme.

Here are some of the schemes out there to help you get onto the property ladder:

Read more in Property

Tiny studio in London on the market for £4,600 a MONTH – there’s a catch

What to do if you HAVEN’T got £150 council tax rebate

Private schemes

Runaway house prices mean that saving the huge down payment preferred by mortgage lenders is a tough task. 

And the Help to Buy scheme, set up by chancellor George Osborne in 2013, is set to close next March.

But there are alternatives.

Generation Home, founded in 2019, is a lender that offers a “deposit booster” option where any number of friends or family can put money towards a borrower’s savings. 

Most read in Money

Co-founder Sophia Guy-White describes the arrangement as “DIY Help to Buy” but, unlike the government scheme, borrowers aren’t limited to new-builds and can previously have owned a property.

Usually mortgage lenders want money from family towards a deposit to be officially declared as a gift. 

But Generation Home instead provides a binding agreement that allows parties to either gift, provide an interest-free loan or give an equity loan.

Proportunity and Ahauz are another two lenders offering equity loans to borrowers with a deposit of at least 5%.

The loans are not restricted to first-time buyers either.

Both providers will lend up to 25% of the property value up to £150,000, but one thing to note is they both charge interest on the loan which needs to be repaid monthly.

Borrowers can use the loans for new-build or previously-owned homes.

Shared ownership

Buying a home through shared ownership is really useful if you can't afford all of the deposit and mortgage payments on a home.

You buy a share between 10% and 75% of the home's full market value, then pay rent to the landlord for the share they own.

You will usually have to pay monthly ground rent and service charges as well, for example towards the maintenance of communal areas such as gardens.

Shared ownership is a great way to get a stake in a property, but there are some downsides.

One is that for the majority of shared ownership properties you can't sub-let your home out.

Another is you are likely to have to ask your housing provider's permission if you want to make any structural changes to your home.

You may also struggle when it comes to selling your home.

For example, if you don't own 100% of your home and want to sell, the housing association or local authority has the right to buy it through a "first refusal" process. They also have the right to find a buyer for your home.

If your housing provider can't find a buyer, you are free to market your share of the property or use an estate agent.

But, you will need to a find a buyer who meets the housing providers eligibility criteria for shared ownership.

And as not all banks provide shared ownership-friendly mortgages, you may find your pool of potential buyers is slimmed down.

Mortgage guarantee scheme

The mortgage guarantee scheme was launched by the government last April in response to the coronavirus pandemic.

The scheme offers lenders the option to purchase a guarantee on mortgages where a borrower has a deposit of only 5%.

A guarantee is an agreement that guarantees a debt will be repaid to a lender by another party if the borrower cannot pay back the debt.

The scheme is running until December 31 this year as it was seen as a temporary measure to alleviate a lack of high loan-to-value lending caused by the Covid-19 pandemic.

The scheme should help a lot of first-time buyers, who may be able to afford mortgage payments, but don't have enough money saved up for a sizeable deposit.

However, it may also work for homeowners looking to remortgage.

There have been cases where homeowners looking to remortgage and who can't mean there are less properties on the market for first-time buyers.

Help to Buy

The scheme, set up in 2013, offers first-time buyers an equity loan towards the cost of purchasing a new-build home.

But you only have until October 31 at 6pm to make any applications under the scheme, which closes next March 31.

There are certain criteria you need to meet if you want to get on the scheme.

You must be over 18, a first-time buyer and be able to afford the fees and interest payments incurred for taking on the loan.

You also can't get an equity loan if you have ever owned a home or residential land in the UK or abroad or had any form of sharia mortgage finance.

Read More on The Sun

I’m a fashion expert – what to buy in Poundland for summerfor under £10

I accidentally became a teen mum & I loved it, so got pregnant again weeks later

You can apply on your own or with other people and all applicants must meet the eligibility criteria.

For more information, go to the government's website.

We pay for your stories!

Do you have a story for The Sun Online Money team?

Email us at [email protected]

Source: Read Full Article