What is a first-time buyer?
A first-time buyer is a person who is buying a house or flat as their home and they have never previously owned a property that was their home.
What is Stamp Duty?
In England and Northern Ireland, you will have to pay stamp duty if you buy a residential property, or land, if the value is more than £125,000 (or more than £40,000 if it is a second home). Whether the property is a freehold or a leasehold, you buy for cash or take out a mortgage – it makes no difference, stamp duty will have to be paid. If you are a first-time buyer you may qualify for stamp duty relief.
Do First-Time Buyers pay Stamp Duty?
First-time buyers qualify for stamp duty relief for properties valued up to £300,000. For any properties above £300,000, you will pay stamp duty on the difference. For example, if you purchased a property for £450,000, you would pay no stamp duty on the initial £300,000, but you would be charged stamp duty on the additional £150,000. Please note – If you are buying a property over £500,000 you will not qualify for the relief and will pay standard stamp duty rates.
For more information, stamp duty calculator and guidance please visit:
Can I be a First-Time Buyer again?
No – To be classed as a first-time buyer you must never have owned a property that was your home.
Is Help to Buy only for first-time buyers?
No – It is available to both first-time buyers and homeowners who are looking to move. With this scheme you have to put in a 5% deposit, the government lends you up to 20% (40% in London) and then you can get a mortgage for the remaining 75%. You do not need to make any payments on the 20% the government has lent you for the 1st five years, after that payments will begin. For more information on how the scheme works you can speak to a mortgage broker or visit https://www.helptobuy.gov.uk/.
Is Shared Ownership only for First-Time Buyers?
No – It is available to both first-time buyers and homeowners who are looking to move. With this scheme, you purchase a share of the property and rent the rest. Most high street lenders require you to put down a minimum deposit of 5% of the share you are purchasing and you can obtain a mortgage for the remainder. Even though you may buy, for example, 40% of the property to start with you can always purchase more of the property over time – this is called stair-casing. For more information visit https://www.themoneyhub.co.uk/mortgages/shared-ownership-mortgages/ or https://www.helptobuy.gov.uk/shared-ownership/.
How much can I borrow?
All lenders have a different way of calculating this. The term of the mortgage, the amount you wish to borrow, whether your income is made up of basic pay, overtime, bonuses, credit commitments that you have and your credit score will all impact on much you can borrow. Most lenders have affordability calculators on their website to give you an estimate, however, it is best to speak with a mortgage adviser for advice on this.
DISCLAIMER: These articles are for information only and should not be construed as advice. You should always seek advice prior to taking any action.