Help to Buy Mortgages Guide

Securing a Help to Buy Mortgage in Wales: Your 2025 Guide

Understanding Help to Buy – Wales

Help to Buy – Wales is a government-backed initiative designed to assist buyers in purchasing new-build homes. The scheme offers an equity loan of up to 20% of the property's value, allowing buyers to secure a home with just a 5% deposit. The remaining 75% is covered by a repayment mortgage from a qualifying lender. This structure reduces the amount needed for a traditional mortgage, making homeownership more accessible.

Eligibility Criteria

To qualify for Help to Buy – Wales, applicants must:

• Purchase a new-build home in Wales with a maximum price of £300,000

• Provide a minimum deposit of 5% of the property's value

• Secure a repayment mortgage for the remaining amount

• Ensure the property has a minimum Energy Performance Certificate (EPC) rating of B

• Use the property as their primary residence

Benefits of the Scheme

Lower Deposit Requirement
Only a 5% deposit is needed, easing the initial financial burden.

Interest-Free Loan Period
The 20% equity loan is interest-free for the first five years, providing financial relief during the early years of homeownership.

Improved Affordability
With a smaller mortgage required, monthly repayments are more manageable.

Considerations

Post-Five-Year Interest
After the initial five years, interest is charged on the equity loan, starting at 1.75% and increasing annually based on the Retail Prices Index (RPI) plus 1%.

Repayment Terms
The equity loan must be repaid when the home is sold, the mortgage term ends, or after 25 years, whichever comes first.

How Mortgage One Can Assist

Navigating the Help to Buy – Wales scheme can be complex. Mortgage One offers expert guidance to help you:

• Determine your eligibility for the scheme

• Identify suitable new-build properties within the price cap

• Secure a repayment mortgage that complements the equity loan

• Understand the long-term financial implications of the equity loan

Alternative Options

If Help to Buy – Wales isn't the right fit, other schemes are available:

Shared Ownership
Purchase a share of a property and pay rent on the remaining portion.

Rent to Own – Wales
Rent a home with the option to buy it in the future.

Homebuy – Wales
Offers an equity loan to assist with purchasing a home, similar to Help to Buy.

Conclusion

Help to Buy – Wales provides a valuable opportunity for buyers to enter the property market with reduced financial strain. With the scheme extended until September 2026, now is an opportune time to explore this option. Mortgage One is here to guide you through every step, ensuring a smooth and informed home-buying journey.