NewBuy Guarantee Scheme to kick start property market

Grovelawn Financial News 12/03/2012

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Only 5% deposits needed

NewBuy Guarantee is designed to help home buyers who are struggling to get on to the property ladder although it is not only available to those buying their first home. The government-backed scheme will offer buyers a mortgage with a large loan to value ratio. The property must be a new build and this will also encourage the construction industry to employ more people therefore kick starting the property market once more.

First time buyers will only need a 5% deposit and is only running in England with builders or developers who have signed up to the scheme. The property cannot be bought to let out and must be valued at £500,000 or less. The deposit must come from personal savings and will not be accepted if it is through a local authority.

British citizens are allowed to source their loan through three lenders, Barclays, Nationwide and NatWest. Halifax and Santander have expressed interest in joining the scheme. The mortgage will be on a fixed rate and there will be no protection for buyers if they fall into negative equity during the lifetime of the mortgage.

← End of stamp duty amnesty causes rush to buy | News For March 2012 | Pensions are a ticking time bomb →

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