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Anyone used Help to Buy before moving into property investment?


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Hi everyone,


My, now, husband and I bought a great property in Manchester last year using the Help2Buy scheme. It's all in my husband's name as my part-time salary at the time wouldn't have helped gain the mortgage. We only put down a 5% deposit and took an equity loan for the rest of it, and we used the Help2Buy ISA scheme to get 25% of our savings added onto our deposit.

 

A fantastic idea at the time as it was the only way we could have ever got onto the property ladder and stop paying rent. - so no regrets... BUT

 

Now we find that we are stuck with an equity loan that doesn't allow us to invest in another property unless we pay it off (technically as the house isn't in my name, I could get a property on my own, but the Help2Buy house can't be rented out) 

 

We know that our options are to pay off the equity loan (difficult) so that we can do what we want with the property, or for me to go solo in investment (a little daunting) and for us to keep living in the Manchester Help2Buy home. 

 

I was wondering if anyone else had been in this situation, using the Help2Buy system to get into property, and then moving on from there?

 

I'd love to hear from you if you have! 

 

Thanks! 

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I don't think there is anything wrong with you purchasing it in your name, although there can be issues for first time buyers (which you technically would be) getting a mortgage for a buy to let. Maybe check whether you could get a mortgage in your name only in the first instance. Alternatively you might be able to set up a company in your and your husbands name and purchase through the company?

 

I think in terms of the options, you need to figure out the costs of the current loan and whether it is better financially to get that paid off before investing or if you could make more money with a buy to let that it would be worth going straight in with that.

 

Another thought, if you still count as a first time buyer (definitely check this) you might want to see whether you could save in a Help to Buy or Lifetime ISA towards your next home, which you could possibly buy together and then pay off the equity loan when you move? These ISAs are good as you get a lot of free money towards your first home! I just am not sure how it works as you are married so worth investigating

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