Help to Buy Scheme Information on the government support available to assist with the purchase of your dream home

Help to buy equity loan scheme, how does it work

Whether you’re first time buyer looking to purchase your first property or an existing homeowner looking to step up the property ladder, a Help to Buy equity loan could get you your dream home

A Help to Buy equity loan is exclusive to new build homes, and combines your 5% deposit with any equity loan from the government of up to 20% of the property’s value, leaving you requiring just a 75% mortgage.

With the Help to Buy equity loan scheme requiring just a 5% deposit, and with the mortgage rates at their lowest on record, this really could be the time to make your move!

help to buy

What is the Help to Buy?

Help to Buy is equity loan assistance to home buyers from Homes England. Help to Buy makes new build homes available to all home buyers (not just first-time buyers) who wish to buy a new home.

Up to a maximum of 20% of the purchase price is available to the buyer by way of an equity loan funded by the Government through Homes England.

Help to Buy is available in England from house builders registered to offer the scheme. Cornovia Homes is registered to offer Help to Buy on selected developments. It is not available on all of our properties.

For Help to Buy, you must take out a first mortgage (with a qualifying lending institution e.g. a bank or building society) for at least 25% of the value of the property you wish to purchase. This mortgage, together with any cash contribution from you, must be a minimum of 80% of the full purchase price. The maximum full purchase price is £600,000.

Your cash deposit contribution must always be a minimum of 5% of the full purchase price.

Homes England will provide an equity loan to fund the balance needed to purchase your home, up to a maximum of 20% of the full purchase price.

How long can I have the loan for and how much do I have to repay?

The equity loan must be repaid after 25 years, or earlier if you sell your home. You must repay the same percentage of the proceeds of the sale to Homes England as that of the initial equity loan (i.e. if you received an equity loan for 20% of the purchase price of your home, you must repay 20% of the proceeds of the future sale).

How much interest/fees do I have to pay on any loan?

For the first five years of Help to Buy home ownership you will pay an initial monthly management fee of £1. This continues until the loan is repaid.

After five years, the equity loan will be subject to an additional interest fee (collected from you on behalf of Homes England by Homes England’s Mortgage Administrator) of 1.75% per annum on the outstanding amount of the equity loan. From the fifth anniversary of the loan this fee will increase each year by the increase (if any) in RPI plus 1%.

Will I have to pay Stamp Duty?

Yes, SDLT is payable on the full purchase price of your property, unless you are a first-time buyer.

If you are a first-time buyer, you may qualify for SDLT relief. The relief applies to purchases of residential property for £500,000 or less, provided you intend to occupy the property as your only or main residence.

First-time buyers purchasing their first home for £300,000 or less will pay no SDLT. Where the purchase price is over £300,000, but does not exceed £500,000, you will pay 5% on the amount above £300,000.

Who provides the contribution for Help to Buy?

The equity loan is provided by Homes England and administrated by your local Help to Buy agent. The contribution is secured by a second charge on your property title registered at Land Registry.

Are there any restrictions on the properties that I can purchase?

All Help to Buy homes are on new build developments where Homes England has a registration agreement with the house builder. You can only purchase from these house builders. Cornovia Homes offers Help to Buy on selected developments. The maximum purchase price for a property is £600,000.

Can I sublet my Help to Buy home?

No. Help to Buy is designed to assist you to move on to or up the housing ladder. If you wish to sublet, you will first have to repay the Help to Buy equity loan assistance.

Can I own a Help to Buy home and buy a second home?

No. Help to Buy is designed to assist you to move up the housing ladder. If you can afford to purchase another home, you will have to repay the Help to Buy equity loan.

The property purchased must be your only residence. Help to Buy is not available to assist buy-to-let investors or those who own any property other than their Help to Buy property after completing their purchase. You cannot rent out your existing home and buy a second home through Help to Buy.

After purchasing my home, can I increase my mortgage or take out another loan?

Not without permission from Homes England’s Mortgage Administrator. Further advances must be approved by Homes England’s Mortgage Administrator. Advances to be used for staircasing or repaying the equity loans will usually be welcomed and approved.

Can I extend or alter the property?

Not without permission. Because Help to Buy is designed to help people move up the housing ladder, you should consider repaying part or all of Homes England’s contribution before making plans for improvements or alterations. This is because Homes England is seeking to help future aspiring buyers and may use the proceeds of these repayments to make more assistance available. Therefore, consent will not usually be granted for significant home improvements.

Where can I find out more about Help to Buy Equity Loans?

Go to the government’s Help to Buy website at or speak to your own personal financial advisor or mortgage broker.



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