How to get £1000s free towards your first mortgage

In fact, by taking advantage of all the government schemes on offer, you can get thousands of pounds towards your first home absolutely free.

Follow these tips and tricks to get yourself on the property ladder even faster.

Help to Buy ISA – get up to £3k free from the government

The help to buy ISA is a great way to get free money from the government to top up your savings towards a deposit on your first home.

You can save £1,200 in the first month, and £200 a month after that, and the government will top up your savings with 25 per cent when you buy.

The maximum amount you can save in this kind of ISA is £12,000 which would get you £3,000 free from the government.

You don't get the money until you complete, so it's no help with your exchange deposit, but if you are up front with the seller, they may be able to defer some of the deposit until completion.

Here's how to avoid the Help to Buy ISA bonus trap.

Lifetime ISA – up to £33,000 in free government money

For most people, a Lifetime ISA is a better alternative to a Help to Buy ISA.

You get the same 25 per cent top up, but you can save up to £4,000 a year.

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The money can be saved either in a cash ISA or a stocks and shares one.

Anyone age 18-39 can open one, but you can keep saving until you are 50.

If you paid in the maximum amount every year, the government bonus would be £33,000.

You have to use the money either for a first property or as part of your pension when you retire. If you use it for any other reason you'll lose your bonus and pay a penalty.

You can't use bonuses from a LISA and a Help To Buy ISA on the same property.

Nottingham Building Society launched a LISA to rival Skipton earlier this,

Help to buy equity loan scheme – borrow up to 20 per cent, interest free for five years

This is available to all first-time buyers and existing homeowners who want to buy a new build house.

The purchase price must be no more than £600,000.

Under this scheme, you can borrow 20 per cent of the purchase price interest-free for the first five years as long as you have at least a 5 per cent deposit.

If you live in London, you can borrow up to 40 per cent of the purchase price.

The Help to Buy loan scheme has been extended to 2023 for first-time buyers.

What are the extra costs of buying a property?

Mortgage broker – Around £500 although online brokers such as Habito and Trussle shift the cost onto the provider so it's free to use for the buyers.

Arrangement fee – The amount lenders charge for borrowing from them – this costs around £1,000 to £2,000.

Booking fee – Sometimes you'll need to pay a booking fee on top of the arrangement fee that is around £100 to £250.

Valuation survey fee – Ranging from £150 to £1,500.

Transfer fee – The charge from moving your mortgage money from the solicitor's account to the seller's solicitor's account. Around £25 to £50.

Mortgage account fee – The lender charges for setting up, maintaining and closing down your mortgage account. It usually costs between £100 and £300. You can choose to add this to the mortgage but then you'll end up paying interest on it so pay upfront if you can.

Solicitor's bill – Usually between £500 and £1,500 plus 20 per cent VAT.

Register the sale with the Land Registry – Your solicitor usually does this and the cost depends on the price of the property.

Stamp duty – If you're buying a property above the £125,000 threshold then you'll need to budget for 2 per cent of the portion that's between the £125,001 and £250,000 threshold, 5 per cent between £250,001 to £925,000 and 10 per cent on properties worth between £925,0001 and £1,500,000.

Removal vans – These can cost between £300 and £600.

Right to buy – get a £103,900 discount on your home

If you rent your home from the local council, you may be able to buy it at a discount.

The size of the discount depends on where you want to live and what kind of property it is.

Usually, you need to have rented from the council for three years before you qualify for this scheme.

The three years can be non-consecutive.

In London, the maximum discount you can get is £103,900, outside of London it is £77,900.

The Right to Buy scheme has now been extended to include housing association tenants in England.

This Sunderland lad bought his mum’s three-bed council house – and the mortgage is £1k a year cheaper than renting.

Shared ownership – slash the costs of renting while getting a foot on the property ladder

Shared owenership is where you buy a percentage of your home and rent the rest.

You need a mortgage to pay for your share, which can be as little as a quarter of the home's full value. The maximum share is three quarters.

You pay reduced rent on the share you don't own.

Later, you can increase your share or even buy 100 per cent of the property.

You need a household income of less than £80,000 outside of London and £90,000 in the capital.

Here are all the pros and cons of shared ownership, plus our guide to taking advantage of the scheme.

Starter home scheme – get at least 20 per cent off your new home

This is a new government scheme that allows first-time buyers under 40 to get at least 20 per cent off the market price of a property.

The discounted price must be no more than 250,000 outside London, and £450,000 in London.

You can only take advantage of the starter home scheme if you buy a new build property.

Here are the areas of the UK with the most newly build homes since 2010.

Buying a house involves more than just saving for a deposit and getting our mortgage. Read our guide to all the steps you need to take and fees you'll need to pay.

This first-time buyer saved a £27k deposit by cycling to work and ordering tap water.

Make sure you know how to avoid the Help to Buy ISA bonus catch.


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