If you are looking to become a homeowner but are finding it hard to turn your dream into a reality, you could be eligible for support under the government's new FirstBuy equity loan scheme.
Announced in the 2011 Budget, FirstBuy is a new £250 million scheme designed to help first-time buyers in England get onto the property ladder by purchasing a new-build property. It is particularly aimed at those who are struggling to save for a large deposit and finding it difficult to obtain a first-time buyer mortgage.
Over the next two years new-build homes will be provided by more than 100 housebuilders, who have so far been selected to take part in the scheme, to more than 10,000 first-time buyers across the country.
FirstBuy is part of the government's HomeBuy range designed to help make home ownership affordable for first time buyers.
Under the FirstBuy scheme, a joint loan of 20 % of the purchase price of a new-build home is provided by the government and the housebuilder, meaning first-time buyers only need to put down a 5 per cent deposit in order to be eligible for a mortgage for 75% of their chosen property's value (i.e. a 75% loan-to-value first time buyer mortgage).
The loan is repaid at the end of the 25 year mortgage term or when the property is resold. The government's share of the funds will then be reinvested to fund more homes for the scheme.
With only 75% of the property's value to finance, buyers can access to a wider range of mortgage products and competitive interest rates, which could result in lower mortgage payments.
To qualify for the FirstBuy scheme, you must be a first-time buyer with a joint or sole annual income of less than £60,000, and be in a position to pay a 5% deposit towards your first home.
Although FirstBuy is aimed at all first-time property buyers, priority is given to Armed Forces personnel, council and housing association tenants and other locally defined priority groups.
If want to become a homeowner but are struggling to build up a large enough deposit to get on the property ladder, then the FirstBuy scheme could be the solution for you.
The first homes under the FirstBuy scheme are expected to be available from September 2011, but first-time buyers can register their interest in FirstBuy now by contacting their local HomeBuy agent.
They will take your details and advise you on what to do next.