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Using Help to Buy Twice

Can you use help to buy twice? Find out here.

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By Pete Mugleston  | Mortgage Advisor Pete has been a mortgage advisor for over 10 years, and is regularly cited in both trade and national press.

Updated: 27th August 2019 *

Can I use the Help to Buy scheme more than once?

We receive lots of enquiries from customers who are struggling to save up for a deposit for a property and want to know whether any help is available to them, even if they’ve been declined a mortgage or have a bad credit history.

One of the most popular ways of getting financial assistance for a deposit is through Help to Buy.

But what are the rules surrounding HTB? We’re often asked, can I use Help to Buy scheme twice e? And are you able to take advantage of it if you’re not a first time buyer? Read on where we’ll be discussing this and more.

  • What is Help to Buy?
    • Help to Buy equity loan
    •  Help to Buy ISA
  • Can you use Help to Buy twice?
  • What factors influence eligibility for Help to Buy?
    • Property value
    • Property type
    • Large deposits
  • What happens next?

What is Help to Buy?

Help to Buy is a government-funded initiative which helps borrowers who are struggling to save for a deposit get a foot onto the property ladder. There are a few schemes that fall under Help to Buy, including the Help to Buy equity loan and the Help to Buy ISA.

What is the Help to Buy equity loan?

The Help to Buy (HTB) equity loan helps you buy a home with as little as 5% deposit saved. The government will add to your savings with an additional 20% of the property’s value. If you’re looking to buy in London, this is extended to 40%.

With a 25% deposit together (45% in London) you are likely to have a wider choice of lenders and access to more competitive rates. You would then take out a mortgage of 75% (55% in London) to make up the rest.

The equity loan is interest free for the first five years. After which, you’ll be charged a fee of 1.75%, rising annually by the increase of the Retail Price Index + 1%.

What is the Help to Buy ISA?

Help to Buy ISA is a saving scheme whereby the governments contributes to your savings by 25%, up to the limit of £12,000. This means you could potentially receive up to a £3,000 government bonus to put towards a deposit for your home.

You can open up your ISA with an initial deposit of up to £1,000 which also qualifies for the 25% government boost. The minimum amount you need to save to qualify for a government bonus is £1,600, which would give you a £400 bonus.

Can I use the Help to Buy scheme twice?

There is a lot of conflicting information on the web surrounding Help to Buy and who is eligible.

So, is it possible to get a second mortgage using Help to Buy?

Can you use the scheme if you’re already a homeowner?

And is it possible to get a HTB mortgage if you’re not a first time buyer?

The short answer to all of the above is - no.

While the equity loan and ISA aspects of HTB differ in some of their requirements, you are only allowed to take advantage of each scheme once. So, if you’ve used either to buy a property in the past, you are not permitted to do so again.

Help to Buy equity loan requirements

The Help to Buy equity loan is available to both first-time buyers and existing homeowners who are looking to move house. However, current homeowners will need to have a sale in place on their current property before you can apply.

You are also permitted to apply if you’ve owned and sold a property previously - provided of course you didn’t use Help to Buy to buy it.

Help to Buy ISA requirements

To quality for a Help to Buy ISA, you must be classified as a first-time buyer; you are not eligible if you currently own or have owned a property in the past.

You cannot have more than one HTB ISA, but if you’re making a joint purchase with another first time buyer, you can both open one. THis means you could potentially save up to £400 a month and double the government bonus.

What other factors affect my Help to Buy eligibility?

Property type

You are not eligible for either the equity loan or Help to Buy ISA if you intend to use it for a Buy to Let (BTL) investment, nor can you sublet the property or, in the case of the equity loan, enter a part exchange deal on your previous home.

The HTB equity loan is limited to new builds only, although there is no restriction on the size of the property you purchase. The HTB ISA can be used on any property type, provided you’re buying with a mortgage and not cash.

Property value

While the Help to Buy equity loan has no restrictions on the size of the property you’re purchasing, it must not exceed the value of £600,000.[1]

The HTB ISA is only available on properties valued at £250,000 or less, or £450,000 in London.

Large deposits

If you have more than 5% deposit saved you can still take advantage of Help to Buy to maximise your deposit contribution. It’s possible to have up to 65% deposit saved, but you must use a minimum of 10% Help to Buy equity loan and 25% mortgage to be eligible.

What happens next?

Once you’ve been accepted for a Help to Buy scheme, there are plenty of other factors lenders consider before authorising a mortgage as well as how much deposit you have, such as:

  • Affordability
  • Bad credit issues
  • Age
  • Non-standard property types

Contact us today to discuss your next steps!

Why you should speak to Help to Buy mortgage broker

We’ve helped over 98,000 people find the right mortgage, in fact our customers consistently rate us 5 stars on Feefo, mainly because of the level of service and the fact that we offer OMA offers a 5-star service-, with access to leading brokers who:

  • Are whole of market.
  • Already know the lenders to go to as they successfully arrange these already.
  • Are OMA Accredited advisors.
  • Have completed a 12 module LIBF accredited training course.

Speak to a Help to Buy expert today

If you like what you’re reading or you’d like to know more, call Online Mortgage Advisor today on 0808 189 2301 or make an enquiry here.

Then sit back and let us do all the hard work in finding the broker with the right expertise for your circumstances. We don’t charge a fee, and there’s no obligation or marks on your credit rating.

Updated: 27th August 2019
OnlineMortgageAdvisor 2019 ©

FCA disclaimer

*Based on our research, the content contained in this article is accurate as of most recent time of writing. Lender criteria and policies change regularly so speak to one of the advisors we work with to confirm the most accurate up to date information. The info on the site is not tailored advice to each individual reader, and as such does not constitute financial advice. All advisors working with us are fully qualified to provide mortgage advice and work only for firms who are authorised and regulated by the Financial Conduct Authority. They will offer any advice specific to you and your needs. Some types of buy to let mortgages are not regulated by the FCA. Think carefully before securing other debts against your home. As a mortgage is secured against your home, it may be repossessed if you do not keep up with repayments on your mortgage. Equity released from your home will also be secured against it.

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