There is a lot of talk lately in the news about mortgages for first time buyers, helping people on the property ladder, no deposits/or low deposits? Does anybody on the forum know much about this topic or about these mortgage schemes or signed for one themselves??
I am at present having to find my 2nd home to rent in 2 years mainly because getting such a high deposit together is so very hard after paying your every day rent and bills, I would really like to own my own house one day soon and was wondering if one of these government mortgage schemes are the way to go?

Any help or advice on this topic would be gratefully received.
Lezza x

I have just bought a house using a government scheme. Sadly the scheme i got isnt available anymore but it was a good'n.

My scheme:

Goverment pays 10%
House Builder pays 10%
You only have to find an 80% mortgage.

You then pay your mortgage as usual for 5 years and then after that time you either start paying off the other 20% or you re-do your mortgage and buy out the other 20%.

I think this year the only "scheme" is a government backed 95% mortgage.

(BTW everything i have mentioned here is for buying New Build homes)

Leza pm adder (Martin) on here, he's a top bloke and is a mortgage specialist.....if anyone can answer you fully it's him.

(a Cheque will do Martin)

As Steve says adder is a top bloke and will find you something if it's available.

Ross

stop it you guys... your making me

The latest scheme is, with certain New Build properties. The builders put in 5% and you have to put in 5%.

There is a 100% mortgage, but your parents property needs to be used (the lender puts a charge on it).

If you want to know more... as above... send me a PM and we can talk properly

Lez, is this to fund Paul's engine rebuild and pink-removal paint job?

No, he is going to buy Greece.... good weather and good food! Should have some change too

Thanks martin(adder) I really just wanted a run down of what was on offer and if any of them was an option or betting than renting and saving for a deposit.
The parents house is not an option so I guess we had better start saving for a deposit

And Paul already has enough of my money, time and car cleaning services thankyou

Lezza - my girlfriend and I have just had our first time buyers mortgage accepted. We decided on a 90% 5-year fixed rate with First Direct.

We don't have a decent deposit saved so have borrowed as much as we can from both sets of parents and will pay them back as soon as we can.

It's a bit of a stretch for our parents, but if they weren't able to help we'd still be renting for years!

Err yes possibly - if you fancy buying an overpriced house from a developer?

We're in the same situation but have a big deposit saved. The problem for us in not getting a mortgage but the fact that property is just so darn expensive for what you get. Some of the asking prices around here are criminal! 240k gets you a two bed flat without a garden and a single parking place. If you want to buy cheaper then you have to move to an area where either it's a total pain to commute to work, or move to an area where knife crime is considered the norm.

Get the feeling that this government scheme is little more than a temporary ploy to try and stop property prices from falling. What the government should actually be doing if they are serious about helping first time buyers is encouraging the building of more starter homes at affordable prices.

Bloody hell mate a 4 bed detached with double garage has just sold in the same close as ours for £215,000.

Sorry but my post isn't going to help Lesa/Paul but here's a little local insight into why cheap starter homes are a non-starter in some locations, in my humble opinion;

We were asked, about 18 months ago, to vote on whether a "common grazing field" in the village should be given over to develop starter homes for younger local people looking for their first homes.

The development proposed would have more than doubled the size of the village (it's actually more of a hamlet, given it has no shops, no pub, no commercial premises of any description) way beyond the fifteen houses here.

The vote in favour: two (well I know that myself and Mrs Stan voted for the proposal), votes against; everyone else!

Speaking to people I discovered the reason given wasn't to do with risks of effect on infrastructure, nor on current house prices, nor increase in traffic, nor construction nuisance.

No, the reason people voted en masse against this proposal was simple: their logic was that "young people" equalled "trouble, noise, lack of pride in the appearance of the locality/their gardens etc, motorbikes, loud parties, noisy cars, drugs etc etc etc". Talk about stereotyping?

Trust me, until you batter down that sort of nimbyism then new starter home builds won't happen in desirable areas unless the government change planning rules, which I understand they were looking at.

Suffice to say we learned more about the type of neighbours we had during that exercise than we had in the ten years we've lived here, and not in a nice way!

Stan, spot on! Whenever any development is proposed that will change anything (by definition??) people will vote against it given the chance. People do not like change of any description. I remember when HS1 was proposed so that the Channel Tunnel could be used properly... there was an almighty hoo-hah. Thankfully the thing was just built, and now the high speed trains are just another part of everyday life.....

If any progressive scheme had been allowed to be voted on by the general populace through history we would still be living in caves eating the last three mammoths....

I'll ignore the bit about the deposit cause I'm not at work. Nice 'gift' your parents gave you.

As for starter mortgages, the government is putting pressure on all lenders. HSBC and first direct have pledged x amount of millions to first time buyers, that's why a few years ago 90% was your whack. Now people like Yorkshire bank are offering 95% at a reasonable interest rate considering.

If the average household income is around £40,000 (two people working) then the price of an affordable house should be no more than three times that - ideally, no more than three times the £25,000 an average full-time worker earns - so around £75-80k... instead, we have houses costing upwards of half a million quid presented as 'starter'.

Three major reasons:

1) Housing was presented for many years as an investment vehicle, not as a machine for keeping the rain off. As a result, sales agents push the price up each time they sell - if that one was worth a hundred grand, this one next door must be at least a hundred and ten - and TV programmes appear like mushrooms after the rain telling you you must keep an eye on the value of a house, wait for the right buyer, rather than dropping the price if you want to sell.

2) Mortgage companies - previously building societies or friendly societies - became banks; changing their regulatory structure and removing their ownership from the lenders (savers) and borrowers and allowing complicated debt-swap schemes that made them appear to have more money than they knew what to do with. Result - lots of loans at over the value of the securing asset to people who in some cases were unable to pay; hence toxic debts and bank crashes while being unable to recover the debts because not only were the houses overpriced in the first place, but they were overpriced even if being sold at reduced rates.[1]

3) A contentious issue: the rise of 'two people working' society... irrespective of the rights and wrongs of working or staying at home, of either sex, there can be little doubt that once it became acceptable for two people in a family to work, there was more disposable income. Which was spent often on houses. Which increased the demand. Which pushed the price up. Which caused houses to be seen as investment... er, see (1).

I'm not even going to discuss the demand caused by the ridiculous rise in one-parent families or by population growth/immigration.

I suspect that if the government required the sort of financial analysis from a lender which was required when I received my first mortgage - about £15k, if I recall correctly - and restricted the analysis to the best-paid member of the household, then we would see a return to a lot of people unable to afford houses. Which would eventually *force* a drop in house prices to sane and affordable levels, though probably not until the estate agents had all been burnt on a pyre of unused 'sold' signs. The '110% mortgage at six times your (self declared) income was never going to work, but people just follow the bubble...

[1] An interesting thing about a house loan: it is secured against the house *at the lender's valuation*, but if you default and the house is repossesed and sold, you do not clear the debt if the sale price is insufficient. I can't help feeling that if it were law that the repossession terminated the borrower's involvement, the lenders would be a damn sight more careful both in the valuation of the property and their evaluation of the lender's ability to pay.

/rant

I have read all the comments you have all made and most of the points being made I agree with, regarding new developments being built in decent areas, if there smaller houses then you do tend to get the slightly louder of families( well you do in stoke) but the larger more expensive developments tend to attract more wealthy families, so people tend to object to small developments which is a shame because everyone has to start some where!
After reading your threads and doing my homework and sums it looks like myself and Paul will be renting for a few more years yet, but what doesn't help is the lack of decents jobs, pay or even enough hours to even start to save for such a high deposit, getting on or back in the property ladder is very hard these days!
Thank you for all your help and advice lads x

Although I agree in principle, the only problem being it would encourage over-stretched borrowers to throw their keys in, as they tried to do in the Eighties property crash. There has to be some form of commitment on both parties.

I wouldn't worry too much as I can't see how there's any rush to go out and buy a property. Yes, rents are high but the price of property is at best stagnating, and is more likely to drop slowly over the next couple of years. Not much chance of property prices continuing to rise in the current climate. So by saving for a bigger deposit then you could be much better off when you do come to buy (i.e. double benefit of a bigger deposit and a cheaper property).

Thanks for that andy I guess your right, I got the estate agent in today, seems a little sad now having to leave, as I really love the house were in now but we just can't afford the mortgage at this moment in time, hence why I hate renting you find a house make it your home then have to leave and start again!

I know how you feel, I have stopped getting attached to anywhere I live now as we likely end up moving every 1-2 years.
We would like to buy but im very unsure of the market and interest rates at the moment.

Is now a good time to buy or are prices going to drop even more?

And they are correct. Take it form someone who had a mass of youngsters move in on a government scheme into our area. Over three years they pretty much destroyed the area and vandalised everything. Now that they are gone, well some are in prison. The area is picking up again.

Gosh I am such an old man aren't I

What annoys me is the buy-to-let market. I have just been shown around my new house (which i'm moving ito on Friday) and i asked if they could tell me anything about the neighbours.

Apparently all the houses around me have been bought by 'investors'.

So i'm now very nervous of a revolving door or students and other young people having loud parties all the time.

Room on that old man park bench for me Sedi ?

That is rather annoying... Investors buying up the property. But to be expected I suppose

I'll move along, there is room for one more...