Achieving homeownership is a huge financial commitment that can be challenging for many due to the high cost of rent. In fact, 79 percent of UK renters struggle to save for a deposit, with 64 percent saying high rent is the reason that they cannot save. Fortunately, there are many schemes that can help first-time buyers such as the Save to Buy scheme.
The Save to Buy scheme, developed by Fairview Homes, is designed to assist first-time buyers in saving for a deposit while also residing in the property they plan to purchase. Under the scheme, potential homeowners can live without paying rent in their homes while their monthly payments go towards their first home purchase instead of to a landlord. This program fills the gap left by the government’s Help to Buy scheme, which ended in 2013.
To qualify for the Save to Buy scheme, an applicant must be 18 years or older, have not previously owned property, jointly or individually, anywhere in the world, and have a 1 percent deposit. They must also be employed full-time for at least three months and pass a credit score and affordability assessment verified by a third party.
The scheme is available on selected plots and is designed to help those who cannot afford to buy a home. The prospective buyer lives in a brand-new home for up to two years at a fixed monthly cost, and 100% of the payment goes towards topping up their deposit.
Fairview Homes predicts that it will take between 6 to 12 months to save for a complete deposit which may extend up to two years if required. Save To Buy agreements will be tailored according to the applicant’s financial status and the average monthly rent in their local area.
To accelerate the deposit-saving process, successful candidates may increase their monthly payments. However, they must seek the assistance of an independent and qualified financial advisor who will provide guidance on the required deposit amount and the income necessary to advance to the purchasing stage.
Upon nearing the required deposit amount within one month, the applicant may submit a mortgage application to a lender and proceed with the regular house-buying procedure.
The properties available under the scheme are located in Epping Gate, Essex, and New Hayes, West London. They feature fitted kitchen appliances, a modern design and range from one to three bedrooms in size. The properties are priced between £325,000 to £500,000.
Overall, the Save to Buy scheme is a great way for potential buyers to save money towards their deposit and eventually own their own home.