Making it on to that first rung of the property ladder is not easy to do. There are plenty of challenges to overcome, and for most buyers, the major one is having enough money to put down as a deposit and secure the mortgage you need.
That is especially true for first-time buyers, but luckily help is at hand.
The First Homes Scheme (formerly known as Help to Buy scheme) is there to assist more people in taking those initial steps into the property market.
First-time buyer discount scheme
First-time buyer discount scheme
If you are a first-time buyer, there are opportunities to buy a new home with a discount that makes the asking price between 30% to 50% less than the market value.
This scheme is currently only operating for purchases in England and is called the First Homes Scheme and is replacing the Help to Buy scheme. (Wales has its own purchase schemes to help homebuyers, which are similar to the original government Help to Buy scheme).
Restrictions on the First Homes Scheme
The property:
There are restrictions, however, as to the type of property you can buy. It has to be either a new home that has been built by a developer, or it must be a home bought from someone who bought it through the scheme (that is, the discount applied remains with the home in perpetuity).
The developer will ensure this is part of the planning proposal, so that the distinction will arise in the conveyancing searches at the time of sale.
This restriction also means that you'll only be able to sell the home for the discounted amount rather than the full market value.
The property must not be priced at more than £250,000 after the discount has been applied (this rises to £420,000 in London and Greater London areas).
This price cap only applies to the first sale of the property.
Every home that is sold in this way is valued by an independent surveyor to ensure the applied discount is based on the actual market value.
Yourself:
When embarking on applying for the process, you establish that you are eligible for the scheme. This is a legal requirement:
- You must be aged 18 or over
- You must be a (provable) first-time buyer
- You must be able to secure a mortgage loan for at least half of the home's price
- You must be part of a household where the total of the planned residents' income is no more than £80,000 (this amount increase to £90,000 if you are planning to buy somewhere in London)
Local council:
The local authorities are responsible for assessing your application. In addition to the previous restrictions, they may apply some of their own.
The government uses examples of potentially rejecting people who don't live in the area, or perhaps focusing on those who are on lower incomes, or if they are essential workers.
Assuming that all is well, and your application is granted by the local authority, they will issue you with an Authority to Proceed alongside an Eligibility Certificate.
There are exemptions from any conditions normally applied by the council:
- You are a member of the armed forces
- You are the divorced or separated spouse or civil partner of a member of the armed forces
- You are a widow or widower of a deceased member of the armed forces (if their death was caused wholly or partly by their service)
- You are a veteran who left the armed forces in the last 5 years
Note: if any of these apply to you, you will still need to meet all the other conditions of eligibility to apply for the First Homes Scheme
Once you have chosen the area you want to buy a new home in, and you want to check your eligibility for the scheme with the council, you can search online for ‘First Homes Scheme' and the council's name for the precise details of their terms.
How the First Homes Scheme works
How the First Homes Scheme works
Buying your potential new home through the governmental scheme works similarly to the standard conveyancing process, but there are some differences to know about.
- Eligibility Check: The first step is determining whether the buyer is eligible for the First Homes scheme. This typically involves checking if they are a first-time buyer, meet income criteria, and may require them to live or work in a specific local area.
- Property Selection: Eligible buyers can choose from properties designated under the First Homes scheme, which are offered at a discounted price. The available properties may vary by location and availability.
- Reservation: Once a property is selected, the buyer typically needs to reserve it by paying a reservation fee.
- Discount Calculation: The discount on the property's price is calculated based on the scheme's guidelines. The discount is usually a percentage of the market price, and this reduced price is what the buyer will pay.
- Mortgage Approval: The buyer needs to secure a mortgage or funding to cover the discounted purchase price.
- Resale Restrictions: Buyers are usually subject to resale restrictions. When they decide to sell the property, it must be sold at a capped price to ensure the discount is passed on to the next first-time buyer.
While the initial steps are different, the legal conveyancing process for transferring property ownership follows a more standard path, involving solicitors, searches, surveys, and contract exchanges, as in a typical property purchase.
Other considerations
Other considerations
Remortgaging your home
On occasion, you might need to obtain some money, and remortgaging might seem like a suitable option to pursue. Perhaps you want to refit the kitchen, or put up an extension, or simply want to consolidate various debts.
Assuming your prospective mortgage lender will be willing to provide the loan, you need to know the situation with First Homes bought under the scheme.
You are permitted to remortgage your home under the scheme. The only provision is that you must base the remortgage on the value of the home minus the discount you got when you bought it. And the value of the house for this purpose is based on the current market value.
For example: if you bought a house with a discount of 40%, the maximum remortgage you could apply for would be one that is 60% of the current market value.
Changes in circumstance
Unfortunately, there may be circumstances that mean you might no longer meet some or all of the eligibility rules as laid down in the Eligibility Certificate provided by the local authority (for example, you have received a pay-rise taking you above the threshold, or you are no longer classified as a key worker).
However, if this happens, you will not be required to sell your home.
Failing to keep up with mortgage payments
As with any home purchase bought with a mortgage, your lender may take action to recover their funds, which might include taking repossession of your home.
If you are struggling with the repayments, talk to your lender to identify what could be done to assist with the situation.
Why come to Homeward Legal for First Home Scheme conveyancing
Simple & Straightforward
We won't confuse you with lots of technical jargon. Just plain, simple English that makes the conveyancing process easy to understand.
Fixed Legal Fees**
When you get residential conveyancing quotes from us, the fixed legal price* we quote you is the price you'll pay, with no hidden costs.
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Don't worry if your move falls through. Our no-completion no fee means there will be no fixed legal fees for you to pay.
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Whether you deal with one of our in-house team or a member of our panel of specialists, we'll find you a solicitor with excellent local knowledge of your area.
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All of the conveyancing professionals that we deal with are regulated under the Solicitors Regulation Authority or the Council for Licensed Conveyancers.
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Any questions? Our team is available to help until 6pm on weekdays, and 4pm on Saturdays.
Conveyancing with Homeward Legal for the First Home Scheme
That's where Homeward Legal can really help with affordable but quality conveyancing services!
We will start work on your planned purchase and/or sale as soon as you agree to the quotation and appoint them to represent you, and will work hard to complete the process in as short a time as possible.
We will also provide a quote that will not change - what you are quoted is what you pay for standard conveyancing process.
There are some unforeseen items that might arise during the purchase and/or sale, but the solicitor discusses these and their cost as they come up.
In addition, to protect the homebuyer further, Homeward Legal operates a ‘no completion, no fee' promise, which ensures that, should the purchase or sale not go through as planned to completion status, no payment is required.
Call to get your conveyancing quote started, or to discuss your concerns with your plans to move.
Or you can get a quick quote, using Homeward Legal's easy-to-use quote generator.
Frequently asked questions...
Whether you are buying or selling, the earlier you can appoint your conveyancing solicitor, the better, because the legal work can start very early in the process. For sellers, this means that your solicitor could draft a contract in advance of finding a buyer, and for buyers, conveyancing solicitors can verify ID checks, proof of funds and the mortgage application if needed.
Promptly instructing a solicitor can reduce any chance of the other side pulling out, and will also mean that you are ready to push forward with an offer as soon as you find a property that you want to buy.
With Homeward Legal's No–Completion No Fee† promise that in the unfortunate event that your property transaction falls-through you will not be liable for any of the conveyancer's fixed legal fees for the work completed.
Plus, when you get a quote for conveyancing services from us, we offer a Fixed legal fee** conveyancing quote with no hidden costs
Why not complete an instant online Fixed Legal Fee* Quote with No - Completion No Fee† today. Or, call one of our friendly team, available 6 days a week, on .Many contaminants can impact a residential property. These need not be restricted to chemical or mineral pollutants either, since investigations into contamination also include proposed erection of mobile masts, or the proximity of electricity pylons.
Where the property has been built on former industrial or agricultural land, consideration will be given to any known pollution that exists in the topsoil or in the vicinity. All aspects of the environmental impact to the property will be considered as part of the environmental searches and reported in the conveyancer’s report on title for the property.
Conveyancing searches are a common bundle of queries carried out for the buyer, with respect to the specific property they are purchasing. The most common (and mandatory for taking out a mortgage) searches are Local Authority, Drainage and Water, Chancel Liability and Environmental, although circumstances may dictate that further searches (e.g. Brine, or Coal or Tin-Mining) may be required, particularly if you are financing the purchase with a mortgage. In these circumstances, your conveyancing solicitor will advise and discuss the need to order these additional searches, as well as providing the cost of these disbursements.
Buyers should be aware that searches cover solely legal-related matters. If you want to know about the structural integrity of the property, you are strongly advised to commission a survey with an RCIS chartered surveyor.
Helpful Conveyancing Guides
Your Fixed Legal Fee** quote from Homeward Legal ensures that you pay no more than we have quoted you for and is based on the information you’ve provided to us being true and accurate.
There are specific circumstances on a minority of transactions that may require additional charges that could not be foreseen at the outset.
A list of those charges and explanations can be found here with details of the potential cost. These will only be charged following discussion with your conveyancer with a clear explanation of what they are for.
No Completion No Fee† is our promise that in the unfortunate event that your property transaction falls-through you will not be liable for any of the conveyancer’s fixed legal fees for the work completed.
To secure this benefit a fee, already included in your quote, is taken upon on deciding to go ahead with your transaction.
Should your transaction fall through, for whatever reason, we can hold this amount on account for your next transaction or provide a refund.
