By Ezra Ivy
Mortgages for key workers are intended to assist persons who work in vital public sector positions in purchasing a new property. This is especially handy for folks who work in high-cost areas like London and cannot afford to buy groceries close to their workplace. People who work in the police, fire, NHS, prison, or state education systems, as well as members of the armed forces, local government, probation services, and environmental officials, are considered key workers.
The Key Worker Living Program was established by the government in 2001 to assist public sector employees in purchasing or renting a property at a reasonable cost. Housing associations and other organizations built affordable homes particularly for the programme and then made them available to people who qualified. The programme terminated in 2019 and was replaced by several additional projects. These are some of them:
- Assistance in obtaining equity loans
This government-backed programme, which began in April 2013, intends to assist borrowers in obtaining a 95 percent loan-to-value (LTV) mortgage on a newly build property. Help to buy equity loans are only available to first-time purchasers up to a particular amount, which varies depending on where the property is located in the UK, and they cannot be used to help with the purchase of older properties. They have to be your only place of abode.
- Programme called “First Homes”
The First Homes programme aims to provide significant discounts on new homes to essential workers and first-time buyers in the area. All houses will be lowered by at least 30% – a reduction that will be passed on to subsequent buyers – and the first sale must be on a property priced at no more than £250,000 after the discount. You’ll need a mortgage that can pay at least half of the discounted purchase price, as well as the needed deposit.
- Right to purchase
This Government scheme is only available in England and is aimed to assist qualifying secure council and housing association residents in purchasing their council house at a great discount. If they qualify, key employees can take advantage of this programme.
- Shared ownership
The English shared ownership programme allows you to buy a property from a housing association for a minimum of 25% up to a maximum of 100%.
You will pay rent on whatever portion of the property is still owned by the housing association.
- Social HomeBuy
Local councils or housing authorities administer Social HomeBuy, a shared ownership alternative. This grant-funded programme also assists tenants in purchasing at least 25% of their rented house. Tenants are required to pay rent on the portion of their residence that is still held by the landlord.
- Discounts homebuilders
It’s worth noting that several major homebuilders provide further discounts for valued employees, typically up to 5% off the buying price of new construction homes. If you’re buying a new house from a construction business, find out if they give a discount to important employees before you start looking for a mortgage or other financing option.
To avail all these benefits of key worker mortgages, you need to contact a key worker to get your work done professionally.
