Essential Workers and Mortgage Advice in London

August 25, 2020 by in category Mortgage Advice tagged as with 0 and 0

What Is An Essential/Key Worker

Essential or key workers are people employed in the police, NHS, fire, prison or public education services, as well as members of the local authority, armed forces, probation services and environmental authorities. These individuals are considered crucial to the smooth sailing of the social infrastructure of any country.

Due to the outbreak of the Coronavirus pandemic, and the lock-down that followed consequentially, most people have gained a lot more awareness about those whose jobs qualify them as essential workers.

What Is A Worker Mortgage

Mortgages for key workers are crafted to help those in public sector jobs to buy a new home. This is especially beneficial for those who work in high-cost areas, like London, who are unable to afford to buy locally.

Under a recent scheme introduced by the UK government, housing associations and other organisations built specific affordable homes and then made these available to eligible people. This scheme, however, ended in 2019 and several other initiatives have taken its place. Some of these include:

First Homes Programme

This recently introduced initiative is aimed at providing a thirty per cent discount on new houses to local first-time buyers and essential workers. Sadly, this scheme isn’t yet launched officially, as the Government has reserved its unveiling for later in 2020.

Help to Buy Initiatives

These equity loans can only be taken out for new build properties up to 600,000 pounds and cannot be employed to facilitate the purchase of older properties. They also have to be your sole residence. Under this scheme, in England and Wales, you can borrow around a quarter of the price interest-free from the Government for five years, as long as you have no less than 5% deposit.

Shared ownership

The British shared ownership scheme lets you purchase as little as 25% and as much as 100% of your rented property from your housing association or landlord. You’ll be paying rent on whatever percentage remains, which is the still in the ownership of the landlord or housing association.

Right to buy

This Government designed this scheme to support qualifying secure council and housing association tenants buy their council home at decent discounts and made it exclusive to England. Essential workers can reap the fruits of this scheme if they qualify.

Social HomeBuy

A different option from shared ownership is Social HomeBuy which is run by housing authorities or local councils. This grant-funded programme also helps tenants to purchase at least 25% of their rented properties. Again, the tenants have to pay rent on the remaining portion of their home, which the landlord still owns.

Discounts From Homebuilders

It’s important to remember that many major homebuilders offer additional discounts to essential workers – generally up to 5 per cent of the price for newly built homes. If you are purchasing a new home from a building company, it’s worth confirming whether they offer a discount to workers before you start searching for a mortgage or related scheme to buy.

How To Apply For A Worker Mortgage

Fortunately, there is a variety of mortgage providers who offer special deals and discounts to those recognised as essential workers. Those considered to be key workers should get in touch with a mortgage broker who’s familiar with such products and which providers offer these in the market.

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