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Help to Buy Scotland: FAQ
Is a new build a good investment? 
A new build property is seen as a good investment by many buyers for a number of reasons. One reason is simply the fact they're completely new. They're built to the latest specifications so are more energy efficient as well as more secure than older properties. The money you can save in the long-term regarding utilities alone such as heating and water immediately make new build properties financially attractive. New builds have also always been a favourite in the buy-to-let market.

With a landlord being able to charge more rent for a new home, it means that any financial spend will be recouped sooner than would be with second-hand homes. New build homes are also in very high demand due to their location or other specific features they have. The price of a new house can rise significantly even before the property has been completed. There are countless other reasons why buying a new home is not just a wise move in itself, but a wise investment that can pay off for you in the future.

Are there any restrictions on the type of property I can purchase?
With Help to Buy Equity Loan, there are restrictions on the type of the property you can buy. In terms of price, the maximum value of the property is £600,000 in England. The equivalent scheme in Scotland has a sliding scale of maximum property prices year on year. In Wales, the maximum property price is £300,000. It must also be a new build home with the housebuilder having a registration agreement with the Homes and Communities Agency. There are no restrictions on the number of bedrooms the property has or the general type of property it is.

Using our comprehensive search facility on Whathouse.com you'll see immediately there are all kinds of new homes available to purchase through Help to Buy right across the country. When looking for a help to Buy property you'll always see the Help to Buy sign next to it which notifies you it is eligible for the scheme.

Can I get help with benefits to pay the Help to Buy fees, if I lose my job?
You wouldn't be able to claim Housing Benefit for Help to Buy fees because they are not classified as rent. It's why, when you're first considering Help to Buy, you should think about all future scenarios including what would happen if you lost your job. Ask yourself how you would pay any fees. If possible, you should try and make sure that other income streams are in place to compensate for any job loss. However, you should be aware that you wouldn't get direct assistance with Help to Buy fees from receiving Housing Benefit.

However, you could get help with your mortgage interest payments. This benefit is called support for Mortgage Interest (SMI) and is usually paid to your lender. It's important to note you can't get help with your actual mortgage loan amount only the interest on it. In addition, it's not always guaranteed you'll receive SMI.

Do I have to pay stamp duty?
The Stamp Duty Land Tax (SDLT), commonly referred to as simply stamp duty, is applicable on all Help to Buy properties. This means for Help to Buy: Equity Loan the SDLT is applicable on the full 100% property purchase price, even it's split up into the 5% deposit, 20% equity loan and 75% mortgage.

For Shared Ownership, there are two ways to pay SDLT. You can either make a one-off payment up front (known as making a market value election) which is based on the full market price of the property. Otherwise, you can pay the stamp duty in stages. If you choose this way you pay SDLT on the first sale amount. Yet, you don't have to pay stamp duty when you're staircasing until you own 80% of the property. You also don't have to pay SDLT when the home is sold. For more details on how SDLT is applied you can go to the government's SDLT Shared Ownership page.

The current rates for SDLT are as follows:

Band SDLT for one home
£0 – £125k 0%
£125k - £250k 2%
£250k - £925k 5%
£925k - £1.5m 10%
£1.5m + 12%

Can I change the property in any way?
You would need permission if you want to alter or extend the property in any way. Before you do start to make improvements you should try and repay all or at least part of the contribution given to you in order that you were able to buy the home in the first place. The reason being that this money will be used to help other buyers, like yourself, get on or move up the property ladder.

However, if requirements were needed in the case of disability or hardship of any kind, your Help to Buy agent would carefully consider any application. If improvements were made, it should be noted that they still wouldn't be considered when a future valuation is done to work out how much should be paid back to the Homes and Communities Agency.

Can I buy a home off-plan?
Yes, one of the many benefits of buying a new house is you can purchase it even before it's been completed. The advantages of this are many including getting the builders to add fixtures and fittings you choose as part of the build.

When a new home development is being built, the housebuilder ideally wants as many homes sold as quickly as possible. The result of this is an early potential buyer being offered financial incentives such as having legal fees or stamp duty paid, or some ‘extras’ provided for free.

Of course, when buying off-plan, it's important not to rush into any decision no matter what financial incentive you're given. You should have as clear a picture as possible of the new house you're moving into. The main way you'll achieve this is by viewing the show home. Yet, you'll also be shown floor plans, online properties that are similar or computer generated designs. You can ask for any documentation or resource from the developer that you feel would give you a better idea of the home you're thinking of buying.

Just as with any other house purchase, do as much research as you can about the area, double check any information you're given and don't rely entirely on the promises given by the developer. It may seem strange at first buying a home that hasn't been built yet, but it can also be very exciting as well as you see your new home being constructed right before your eyes. Buying a home off-plan can also have extra advantages such as it usually being worth more when it's completed than the price you paid for it at the beginning of construction.

If and when you do decide to buy off-plan, you should know already when the estimated completion date is. Builders have to work to strict guidelines so if they're late in due dates they can pay financial penalties. Once you feel completely satisfied the property is the one you want to purchase then you can reserve it. It may be a plot you reserve and again within a development the sooner you can reserve a plot, the better. After you have reserved your new home, you can pay a deposit at a later date.

If you already know you qualify for Help to Buy, you can go to your local Help to Buy agent and inform them of your plans. You also need to find a lender to provide the remaining mortgage, for instance, 75%, for equity loan. You also need a solicitor to deal with all the contract paperwork.

As the completion date of your new home becomes nearer, so you can check the progress of the house build and deal with the final paperwork. You should have a snagging survey carried out and once you're satisfied everything is correct, it's simply a case of moving into your new home.

Help to Buy Scotland: FAQ
Is a new build a good investment? 
A new build property is seen as a good investment by many buyers for a number of reasons. One reason is simply the fact they're completely new. They're built to the latest specifications so are more energy efficient as well as more secure than older properties. The money you can save in the long-term regarding utilities alone such as heating and water immediately make new build properties financially attractive. New builds have also always been a favourite in the buy-to-let market.

With a landlord being able to charge more rent for a new home, it means that any financial spend will be recouped sooner than would be with second-hand homes. New build homes are also in very high demand due to their location or other specific features they have. The price of a new house can rise significantly even before the property has been completed. There are countless other reasons why buying a new home is not just a wise move in itself, but a wise investment that can pay off for you in the future.

Are there any restrictions on the type of property I can purchase?
With Help to Buy Equity Loan, there are restrictions on the type of the property you can buy. In terms of price, the maximum value of the property is £600,000 in England. The equivalent scheme in Scotland has a sliding scale of maximum property prices year on year. In Wales, the maximum property price is £300,000. It must also be a new build home with the housebuilder having a registration agreement with the Homes and Communities Agency. There are no restrictions on the number of bedrooms the property has or the general type of property it is.

Using our comprehensive search facility on Whathouse.com you'll see immediately there are all kinds of new homes available to purchase through Help to Buy right across the country. When looking for a help to Buy property you'll always see the Help to Buy sign next to it which notifies you it is eligible for the scheme.

Can I get help with benefits to pay the Help to Buy fees, if I lose my job?
You wouldn't be able to claim Housing Benefit for Help to Buy fees because they are not classified as rent. It's why, when you're first considering Help to Buy, you should think about all future scenarios including what would happen if you lost your job. Ask yourself how you would pay any fees. If possible, you should try and make sure that other income streams are in place to compensate for any job loss. However, you should be aware that you wouldn't get direct assistance with Help to Buy fees from receiving Housing Benefit.

However, you could get help with your mortgage interest payments. This benefit is called support for Mortgage Interest (SMI) and is usually paid to your lender. It's important to note you can't get help with your actual mortgage loan amount only the interest on it. In addition, it's not always guaranteed you'll receive SMI.

Do I have to pay stamp duty?
The Stamp Duty Land Tax (SDLT), commonly referred to as simply stamp duty, is applicable on all Help to Buy properties. This means for Help to Buy: Equity Loan the SDLT is applicable on the full 100% property purchase price, even it's split up into the 5% deposit, 20% equity loan and 75% mortgage.

For Shared Ownership, there are two ways to pay SDLT. You can either make a one-off payment up front (known as making a market value election) which is based on the full market price of the property. Otherwise, you can pay the stamp duty in stages. If you choose this way you pay SDLT on the first sale amount. Yet, you don't have to pay stamp duty when you're staircasing until you own 80% of the property. You also don't have to pay SDLT when the home is sold. For more details on how SDLT is applied you can go to the government's SDLT Shared Ownership page.

The current rates for SDLT are as follows:

Band SDLT for one home
£0 – £125k 0%
£125k - £250k 2%
£250k - £925k 5%
£925k - £1.5m 10%
£1.5m + 12%

Can I change the property in any way?
You would need permission if you want to alter or extend the property in any way. Before you do start to make improvements you should try and repay all or at least part of the contribution given to you in order that you were able to buy the home in the first place. The reason being that this money will be used to help other buyers, like yourself, get on or move up the property ladder.

However, if requirements were needed in the case of disability or hardship of any kind, your Help to Buy agent would carefully consider any application. If improvements were made, it should be noted that they still wouldn't be considered when a future valuation is done to work out how much should be paid back to the Homes and Communities Agency.

Can I buy a home off-plan?
Yes, one of the many benefits of buying a new house is you can purchase it even before it's been completed. The advantages of this are many including getting the builders to add fixtures and fittings you choose as part of the build.

When a new home development is being built, the housebuilder ideally wants as many homes sold as quickly as possible. The result of this is an early potential buyer being offered financial incentives such as having legal fees or stamp duty paid, or some ‘extras’ provided for free.

Of course, when buying off-plan, it's important not to rush into any decision no matter what financial incentive you're given. You should have as clear a picture as possible of the new house you're moving into. The main way you'll achieve this is by viewing the show home. Yet, you'll also be shown floor plans, online properties that are similar or computer generated designs. You can ask for any documentation or resource from the developer that you feel would give you a better idea of the home you're thinking of buying.

Just as with any other house purchase, do as much research as you can about the area, double check any information you're given and don't rely entirely on the promises given by the developer. It may seem strange at first buying a home that hasn't been built yet, but it can also be very exciting as well as you see your new home being constructed right before your eyes. Buying a home off-plan can also have extra advantages such as it usually being worth more when it's completed than the price you paid for it at the beginning of construction.

If and when you do decide to buy off-plan, you should know already when the estimated completion date is. Builders have to work to strict guidelines so if they're late in due dates they can pay financial penalties. Once you feel completely satisfied the property is the one you want to purchase then you can reserve it. It may be a plot you reserve and again within a development the sooner you can reserve a plot, the better. After you have reserved your new home, you can pay a deposit at a later date.

If you already know you qualify for Help to Buy, you can go to your local Help to Buy agent and inform them of your plans. You also need to find a lender to provide the remaining mortgage, for instance, 75%, for equity loan. You also need a solicitor to deal with all the contract paperwork.

As the completion date of your new home becomes nearer, so you can check the progress of the house build and deal with the final paperwork. You should have a snagging survey carried out and once you're satisfied everything is correct, it's simply a case of moving into your new home.

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