The Chancellor announced that from April this year two new equity loans will be available through the Government's shared equity scheme Open Market HomeBuy (OMHB). The loans allow buyers to shop around for the best mortgage deals and are simpler to arrange than previous OMHB products.
Until now OMHB loans could only be taken out in chunks of 32.5%, 25%, or for the Government only loan, an average of 17.5% of the property value. The loans were also restricted to just one specific mortgage from each of the three lenders providing the loans.
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This has now ended with more flexibility in the percentage of the value of their home that can be borrowed - to a maximum of 50% - and more choice in the mortgage buyers take out.
This means a household with an income of £32,000 could afford a house of £200,000, paying £760 each month - as opposed to £1,350 without the scheme.
Housing and Planning Minister Caroline Flint said: "We have already helped more than 95,000 households onto the housing ladder since 1997 through our low cost home ownership schemes. These new products will help us do even more.
"Not only will the new loans increase affordability for key workers and first time buyers, they are a lot more flexible, allowing buyers to shop around for the best mortgage deals."
(CD)
