Buyers hoping to use England’s current equity purchase assistance program have just over a month to do so, as the program will close new applications on December 15.
These applicants will then have just over three months to complete their purchases before the March 31 deadline – although many in the real estate market warn that this could be a challenge given current demand.
Meanwhile, the successor program which includes regional ceilings and is limited to first-time buyers only will start accepting applications from December 16.
This scheme will not come into force until April 1 and is currently expected to be open for two years.
The announcement was made by the Ministry of Housing, Communities and Local Government (MHCLG) as it released a guide to the new program.
“Applications for Purchase Assistance: Equity Loan Program 2013-2021 end on December 15, 2020,” MHCLG said.
“First-time buyers eligible for Purchase Assistance: Equity Loan (2021-2023) can apply from December 16, 2020, to a home builder registered in the program. “
The guide that explains how the Home Buyer’s Assistance Program works includes recommendations for seeking independent financial advice when buying the home.
Buyers have three months to exchange the contracts once they are given permission to proceed and must then complete the home purchase within six months of the contract exchange.
Authorization required for modifications
Structural changes to the property, such as adding an extension or converting a bedroom to a bathroom, are not permitted under the new program without permission from Homes England.
He noted that permission will only be given to make structural changes for medical reasons.
“Home Buyers Help is for first-time homebuyers, now and in the future. We want to make sure they are always affordable, ”he said.
“The equity loan is tied to the value of your home. So, if you make any structural changes without our permission and it increases the value of your home, the amount of equity loan you owe will increase.
“If we give permission to make structural changes and the value of your home increases, we will ignore the value of that change when we determine how much you owe on your home equity loan.”
Owain Thomas is Editor-in-Chief and Contributor of Mortgage Solutions and Editor-in-Chief of Specialist Lending Solutions. He also has experience in the areas of protection, pensions, benefits and human resources. Owain won two Headline Money Awards and the Protection Review Journalist of the Year award.