Should I sell and use Help to Buy?

[Mark1_01]

Hi - I currently own a small 1 bed in London that I own and live in - currently under mortgage.

I'm wondering if I should sell this and use the new Help to Buy to purchase a new build flat in London?

What are people's thoughts on this?

Thanks!

 

[Longterminvestor]

Under the terms of the scheme would you need to physically sell your existing property first before applying for help to buy? Also, while I understand that you pay a 5% deposit and the government lend you up to 40% this is only interest free for the first five years. Maybe I am being too cautious but this doesn't give you a lot of wiggle room if the market was to take a downturn?

 

[Mark1_01]

Hi - that's a good point - I don't know whether I could enter into an 'exchange' deal with a New Build developer to get on Help to Buy.

On the market downturn point - if the fair value of the property drops, in theory, the money you owe the government also drops, so there's that.