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95% Mortgages & Stamp Duty Tax Holiday Extension

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Love Mortgages: 2021 Budget Announcements
As many of you will be aware, Chancellor Rishi Sunak put forward his 2021 Budget and this came with many announcements, some of these impacting the mortgage industry and buyers alike. We wanted to share with you those announcements and talk about how we can help you at this time.

The Budget brought in many measures including those dealing with the pandemic, those protecting jobs and livelihoods, and more.

However, there were two things that were announced yesterday which affect the mortgage industry - which also affects you as the consumer – and these are:

  1. Stamp duty holiday extension
  2. Confirmation of 95% mortgage guarantee scheme
So, what does this mean for us – and for you?

Stamp Duty Holiday Extension Until June 2021

We mentioned a few months ago that we had seen the number of mortgage approvals on the rise and how the stamp duty holiday had certainly increased demand in the housing market. July 2020 saw a massive house buying boom, in part because of the aforementioned stamp duty holiday, and we expect that many more potential buyers will take advantage of this extension whilst they can!

The stamp duty holiday on house purchases has now been extended for a further three months, meaning the tax break will continue until the end of June. If you are not sure what this means, it means that the property purchase tax has been suspended on the first £500,000 of all sales in England and Northern Ireland. This has been in place since July 2020.

In Wales, there are other existing SDLT savings compared to the standard rate in England. Call us on 01244 90 44 10 for advice or message us here.

After June 2021, the extended SDLT holiday will reduce down to £250,000 which is still double the usual amount and this will remain in place until the end of September 2021. The beginning of October will see the return of the usual level of £125,000.

The break on tax was originally introduced to help those buyers who might have been adversely affected by COVID-19. It was put in place to ensure they could still purchase at the time they wanted to – as they would not have been impacted financially if it was not for the pandemic. It was also introduced in the hope it would boost the property market – which it sure did!

This holiday extension is incredibly positive news for potential buyers, and we welcome the news, especially if it brings with it the increased demand that we have been seeing in recent months. We are more than happy to help any potential buyers that are taking advantage of this extension to find the right mortgage for them – after all, we offer eight different types of mortgage!

95% Mortgage Guarantee Scheme Confirmed by Chancellor

This is the big one! For many buyers, this 95% mortgage guarantee scheme is very exciting and welcome news as it allows those with smaller deposits to get their foot on the property ladder. We at Love Mortgages will have full access to all of the lenders who are starting to offer 95% mortgages so do feel free to get in touch today to discuss the possibility of getting one of these mortgages.

But what exactly is a 95% mortgage and what does this guarantee scheme that the Chancellor has put into place entail?

A 95% mortgage is exactly what it claims to be. It is a mortgage deal where the buyer (i.e. you) puts in 5% as a deposit and gets a mortgage for the rest – which is 95%! Low deposit, high mortgage deals such as this have been in extremely short supply in recent years – especially during recent months with the ongoing pandemic – so this guarantee from the Chancellor is sure to be music to many buyers’ ears.

Launching next month, a number of lenders will be offering these mortgages, and these are in place to help buyers with smaller deposits get on the property ladder. It means that buyers would only need a 5% deposit to take advantage of these mortgage deals, rather than a larger deposit amount such as 10-20%. With many potential buyers putting off buying property until they have a larger deposit, this could see many people realising their property dreams long before they believed they would.

It is also going to be available to all borrower types on properties up to the value of £600,000. This means current property owners will also be able to take advantage of these as well as first-time buyers – a positive for those who may be looking to move into a larger property but were finding it a little difficult.

There is hope that the scheme will make a real difference in enabling more people to get a new home without having to worry about saving more and more money for a deposit. There should be a larger number of mortgage deals available to you at our fingertips – and we can go through all of the lenders with you and find them the perfect one. Want a free no-obligation chat? Contact us here.

We predict that we will see an increased demand for property in the next few months as people look to get some advice on these mortgages; perhaps an even larger increase than we have already been seeing - and the whole team here at Love Mortgages are incredibly excited to help!

These two announcements are great news for buyers and could see many more first-time buyers with their own properties by the end of the year or over the next 2 years. It could also see existing property owners finally being able to make the moves they have been planning for years.

If we can help you with anything mortgage-related, please get in touch. You can also like us on Facebook to hear news like this first as we are always posting relevant updates on our page. We are here to help you. Not only do we offer mortgages, advice, and protection locally in Chester and Flintshire, but we also work nationally too!

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