What is MyChoiceHomeBuy?

MyChoiceHomeBuy is a flexible equity loan scheme designed to help households earning between £20-60,000 p.a. to buy their own home on the open market. You will own the home and our loan will be secured by a second charge against the property.

Who can apply for MyChoiceHomeBuy?
Eligibility for MyChoiceHomeBuy is targeted at groups such as social tenants and key workers. Most applicants are first time buyers; however, we can also help a number of people who have previously owned properties but are now unable to buy without assistance, for example in the case of a relationship breakdown. The government has prioritised the following groups for assistance under MyChoiceHomeBuy:

• Social rented tenants and housing association tenants.
• Local residents prioritised on housing waiting lists.
• Public sector key workers.
• First time buyers who cannot afford to purchase without assistance

How does it work?
You choose a suitable property (probably through an estate agent) on the open market. You will need to obtain a mortgage through an independent financial advisor, bank or building society. When the property you choose is approved by us, you pay a percentage of the purchase price with a mortgage and any savings or deposit you may have. We will give you an equity loan to cover the remainder of the purchase price between 15% and 50% of the property value, depending on your individual circumstances. There is a low monthly interest charge on the loan of up to 1.75% p.a. The loan is redeemed in full when the property is sold.

Can I pay back part of my equity loan?
You can pay back all or part of your equity loan after one year of owning your home. Your home will be valued by an independent surveyor who is a memberr of the Royal Institution of Chartered Surveyors (RICS). If you decide to proceed, it will be at a price based on the valuation at that time. The monthly charge that you pay will be reduced proportionately - to zero in the event that you pay back your loan completely

Do I need to have any savings?
We estimate you will need about £3,500 to cover legal fees, mortgage fees, stamp duty and other costs associated with buying and moving into a property.

How much loan is available?
This will be from 15 - 50% (up to a maximum of £140,000) of the property value and depend on your household income, family size and property values in the area where you live or work.

Do I have to make monthly repayments?
Yes, you must maintain your home and pay all bills including amenities, council tax and buildings insurance. You are responsible for mortgage repayments and the charge of up to 1.75% p.a. on the equity loan.

Example:

When I sell my home, how much do I have to pay back?
The loan you receive through the MyChoiceHomeBuy scheme represents a percentage of the purchase value of your property.

When you sell, you will repay the same percentage based on the property’s value at the time of sale. In certain circumstances, you can transfer your loan to another property but you must have the prior approval of your equity loan provider.

If I need to move home, do I have to repay the loan?
There are certain circumstances where key workers are allowed to transfer their loan to another property. However, in general this is not allowed and you will have to repay your loan if you wish to move.