



The prospect of buying your first home could be both daunting and confusing. Our aim is to guide you through the transaction from start to finish so that you understand exactly what the purchase entails and how much it will cost. We can recommend the services of local solicitors to assist in this process. This maybe the largest financial transaction you are ever likely to make so it must be done with clarity.
Prior to the credit crunch, the property market moved very fast which led to significant increases in property prices. This made it very difficult for many people to afford to buy a home, particularly for first time buyers.
The credit crunch of 2007 saw property prices drop considerably in many regions of the UK, making housing more affordable. However, since the 4th quarter of 2013, we have seen an improvement in the housing market and house prices have started to rise again.
The effects of the credit crunch and the continued financial uncertainty globally means that mortgages may still be difficult to find and we believe borrowing criteria is likely to remain stringent. There are, though, still a significant number of lenders to choose from, and we will search a comprehensive range of mortgages from across the market to find a mortgage appropriate to your requirements.
There are actually some advantages to being a first time buyer. Interest rates are currently very low, and first time buyers are more appealing to sellers because they are not in a chain.
As we have access to many lenders we are well placed to assist you, however these days it is a necessity to provide a substantial deposit in order to get a mortgage (although there are a number of 95 per cent mortgage deals around), and you may be eligible for further assistance from the Help to Buy Scheme.
Help to Buy: Mortgage Guarantee
The second phase of the Help to Buy scheme came into effect in October 2013. In this scheme, first time buyers (as well as existing homeowners) are able to purchase either a new build property or an existing property in the UK - not just in England - with a deposit as low as 5%.
A mortgage is required from a lender of up to 95% of the property’s value, with the Government guaranteeing the lender (not the purchaser) up to 15% of the property value.
This mortgage guarantee scheme will run until 31 December 2016 and is available for properties with a purchase price up to £600,000.
Call us now or use our mortgage enquiry form and we'll be delighted to assist you.
The Scottish Government is committed to supporting home ownership in a balanced and sustainable way by helping people on low to moderate incomes to become home owners, where that is affordable for them.
Its Low-cost Initiative for First Time Buyers (LIFT) brings together several ways to help households access home ownership. These include:
The Open Market Shared Equity Scheme allows people on low to moderate incomes to buy homes that are for sale on the open market where it is affordable for them to do so. The scheme is currently open to help all first time buyers. Priority access will be provided to priority group applicants which include social renters (in other words, people who rent a property from either a local authority or a housing association), disabled people, members of the armed forces, veterans who have left the armed forces within the past two years, and widows, widowers and other partners of service personnel for up to two years after their partner has been killed while serving in the armed forces.
The minimum equity stake that buyers must take in a property is 60 per cent and the maximum equity stake is 90 per cent. Lenders normally require buyers to provide a modest deposit.
Applications to the scheme are assessed by registered social landlords who administer the scheme on behalf of the Scottish Government. Registered social landlords will undertake a detailed financial assessment of individual household circumstances using certain criteria, such as looking at the disposable income the household has. This information will be obtained from the standard application form which applicants to the scheme must complete.
There are limits set on the price of homes that can be bought under the open market scheme to ensure that only 'starter' properties are available through the scheme - these are known as threshold prices. These limits vary according to house prices in different parts of Scotland and are often referred to as local maximum price ceilings.
For more information contact us or click here: Open Market Shared Equity Scheme or go to: The Grampian Housing Association.
Shared equity is a way to buy a home without having to fund all of it. When you buy a shared equity home from a housing association or on the open market you pay for the majority share in it and the Scottish Government pays the rest under an agreement which it enters into with you. You own the home outright, but the Scottish Government holds a security over the proportion of it has funded. When you later sell your home (or earlier if you want to increase your stake), the Government will receive the value at the time of sale of the percentage equity stake funded. If, for example, the Government funds 30 per cent of the purchase price, when the property is sold 30 per cent of the sale value of the property will be returned to the Scottish Government.
When you buy a LIFT shared equity home from a private housebuilder, you also own the home outright, but the Government and the private housebuilder will jointly fund an interest-free equity loan for you and each hold a security over the proportion of your home they have funded. When you sell your home (or earlier if you want to increase your stake), the Government and the private housebuilder will each receive the value at the time of sale of the percentage equity stake funded. If, for example, the Government and the private housebuilder each fund 15 per cent of the purchase price, when the property is sold the government and the housebuilder will each receive 15 per cent of the sales value of the property.
In April 2013, the Government rolled out the first phase of a new Help to Buy scheme, which offers equity loans to first time buyers (as well as existing homeowners) by providing borrowers with a loan for 20% of the property value. This scheme applies to new build properties only, and with the purchaser being required to put down as little as 5% as a deposit, a mortgage of only 75% would be needed from a lender.
This scheme is available in England only until 2020. Different variations to the Help to Buy scheme apply in Wales and Scotland.
A MORTGAGE IS A LOAN SECURED AGAINST YOUR HOME. YOUR HOME MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON YOUR MORTGAGE OR ANY OTHER DEBT SECURED ON IT.
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Company address: City Gate Aberdeen Ltd, 51 Chapel Street, Aberdeen, Scotland, AB10 1SS
T: 01224 590600 E: enquiries@citygateaberdeen.co.uk
Registered Address: Same as above
Registration in Scotland under reference: SC236583
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