You need £17,000 for a first home - here's how to do it
Summary
The "Your First Home" scheme in England helps first-time buyers save for a home deposit by allowing a small deposit of 5% on the average house price. Experts suggest several ways to save including regular savings, using a Lifetime ISA with government bonuses, starting to save early, and considering low-deposit mortgages.Key Facts
- The average UK house price is about £272,000, requiring a 5% deposit of around £16,850.
- Saving regularly like a monthly bill helps build a deposit gradually.
- A Lifetime Individual Savings Account (LISA) allows saving up to £4,000 yearly with a 25% government bonus, up to £1,000 per year.
- LISA money can only be used for homes costing under £450,000 or after age 60, with penalties for other withdrawals.
- Starting to save early benefits from compound interest, which adds interest on interest over time.
- Some lenders offer mortgages with deposits as low as £5,000, borrowing up to 98-99% of the home price.
- Not everyone qualifies for low-deposit mortgages, and some buyers receive help from parents.
- The government plans to replace the LISA with a new First Time Buyer ISA, but details are not yet clear.
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