Homebuy Direct
What is HomeBuy Direct?
HomeBuy Direct is a new product from the Homes and Communities Agency, working
in partnership with house builders.
It aims to make more new affordable homes available to eligible buyers priced out of the housing market.
It is part of the Governments low cost home ownership initiative, and is available
in England through local HomeBuy Agents and participating house builders and housing
associations.
HomeBuy Direct is only available on developements which are taking part in the
scheme. There is a list of these developments available to download at the foot
of this page. If you are interested in a development that is not listed then unfortunately
this will not be a HomeBuy Direct scheme.
How does HomeBuy Direct work?
With HomeBuy Direct, the buyer purchases a new home on a HomeBuy Direct development
with assistance from the Homes and Communities Agency (the HCA) and the house
builder in the form of two equity share loans.
You must take out a first mortgage (with a qualifying lending institution, this
includes most high street banks and building societies). The mortgage, together
with any cash contribution from you, must be a minimum of 70% of the full purchase
price.
The HCA and the house builder will provide equal equity share loans to make up
the cost of your home, up to 30% of the full purchase price.
These equity loans are repaid when you sell your home, at which point you must
repay the same percentage of the proceeds of the sale to the agency and the house
builder as the initial equity loans. (i.e. if you received equity loans for 30%
of the purchase price of your home, you must repay 30% of the proceeds of the
sale).
The equity loans are interest free for 5 years, after year five, you will pay
a fee on the equity loan of 1.75%, rising annually by the retail price index (RPI)
plus 1%
If you purchase through HomeBuy Direct you still have 100% title of your home
and you can sell it on open market without restriction.
Your application will be assessed by your Local HomeBuy Agent, My4walls, and
you will be given a decision on your status within a few days. If you wish you
can apply online.
Before you choose a home of enter into the buying process you must have your
application assessed and be confirmed as eligiable by my4walls.
Please download the HomeBuy Direct Buyers Guide at the foot of this page for
full information on how the scheme works.
Who qualifies?
- you cannot afford to buy a home on the open market without help
- you earn £60,000 a year or less ( this is a maximum national figure, eligibility
will be assessed around the persons ability to buy a home without help)
- you are a social tenant or a key worker earning £60k or less and unable to buy
a home without help.
- you must be able to demonstrate access to savings or have sufficient funds to
pay (if required) a deposit, legal fee's, stamp duty and other movinfg costs.
- you must be able to sustain home ownership in the longer term. ie you should
be employed on a permanant contract or if self employed have 3 years accounts.
- you must not already be a current home owner or have your name on a home mortgage.
If you have had your name on a mortgage you must provide evidence that is has
been (or is in the process of being) removed.
- you must have a good credit history.
- you must take out a first mortgage with a qualifying lender.
As with most things there are sometimes exceptions to the rules. Please read
the HomeBuy Direct Buyers Guide for more information or call us if you need advise.
How do I buy a HomeBuy Direct home?
There are 5 stages in the buying process. Please read the HomeBuy Direct Buyers
Guide for full details on this process. The Guide can be opened or downlaoded
on this page.
Further information
The initiative is making HomeBuy Direct homes available nationally. You should
contact my4walls (your local HomeBuy Agent) to make an appliction and find out
more about the availability of HomeBuy Direct in Yorkshire.
