First things first – who does what:
We will: handle your mortgage application and work with the lender to get your mortgage approved. You will know your mortgage has been approved when you are issued a Mortgage Offer document by the lender.
You will: be in charge of applying for the government Help to Buy (HTB) loan. You can either ask the property developer to send your HTB application in or you can do so yourself.
Applying for your Help to Buy loan
- Find a property: through a registered Help to Buy builder/developer in your area.
- Mortgage: speak to us and find out if the purchase is affordable. You can plan ahead by making sure you will have funds for the deposit, property reservation fee, stamp duty, solicitors fees etc.
- Reserve the home: at this stage you will be asked to pay the reservation fee.
- Send your application to the local Help to Buy agent: this is usually done by the HTB registered property developer but you can also do this yourself online.
HTB agents will need:
- Signed and completed Property Information Form
- Signed and completed builders' Property Reservation Form
Authority to Proceed
HTB agent should issue you an Authority to Proceed letter within 4 days of receiving the Property Information Form from the developers (or from you, if you apply yourself).
Only once you have your Authority to Proceed, we will be able to progress your mortgage application. This is the right time to instruct a solicitors firm and let us know to submit your mortgage application to the lender.
The Authority to Proceed will be accompanied by an instructions pack including legal documents for your solicitor/conveyancer.
Your mortgage is approved by the lender and your Help to Buy loan is approved by Homes England.
Both will need to be in place independently so that the solicitors representing you are able to complete the purchase.
Mortgage offer and exchange of contracts
- Your solicitor will advise and ensure you sign the sale contract and the Help to Buy equity loan;
- Your solicitor will explain the legal implications of the equity loan, that the Help to Buy home must be your only residence and the consequences of a fraudulent application (see below);
- Your solicitor or conveyancer will check that your mortgage offer, property price and available funds are consistent with the Authority to Proceed, and will request the approval to exchange contracts from the local Help to Buy agent;
- Once your local Help to Buy agent issues the approval to your solicitor/conveyancer, contracts are exchanged;
- If required, you will have paid a deposit and now be legally obliged to complete the purchase by the date agreed in the contract;
Completing the purchase
At this stage, your solicitor will use the mortgage funds from your lender and the Help to Buy funds from Homes England to complete the purchase.
Once completion has taken place, you will own the property and will be free to move in.
The remaining things for your solicitor to do will include returning the confirmation of the sale to your local Help to Buy agent, in order to register your details with the Homes England mortgage administrator.
At this point, a second charge is registered on your home in favour of Homes England, entitling it to a share of the future sale proceeds. The charge will be equivalent to the percentage contribution made towards the purchase price.
For more information please read the Help to Buy Buyer’s Guide.