So what is FirstBuy?

FirstBuy gives you the chance to buy a brand new home with the help of an equity loan of up to 20% of the full purchase price. It is a Government led deposit assistance scheme provided jointly by the Homes and Communities Agency and developers like Westco Properties, part of Devon & Cornwall Housing group. It aims to help first time buyers on to the property ladder.

With FirstBuy, the buyer (‘you’) buys a new home on an approved FirstBuy new build development, such as Beacon Heights, with assistance from both the Homes and Communities Agency and the house builder in the form of two equity loans.

You must take out a first mortgage (with a qualifying lending institution eg. a bank or building society). This mortgage together with any cash contribution from you, must be a minimum of 80% of the full purchase price. The HCA and Westco will provide equal equity loans to fund the balance needed to make up the full purchase price of your home, up to a maximum of 20% of the full purchase price. These equity loans must be repaid when you sell your home, at which point you must repay the same percentage of the proceeds of the sale to the HCA and Westco as the initial equity loans, so if you received equity loans for 20% of the purchase price of your home, you must repay 20% of the proceeds of the sale.

The equity loans are interest free for the first five years.After that, you will pay a fee on each of the equity loans of 1.75%, rising annually be the increase (if any) in the Retail Price Index (RPI) plus 1%. In addition you can, if you wish, make voluntary part repayments of the equity loans (staircasing).

If you purchase a home through FirstBuy, you will have 100% title to your home and can sell it on the open market without restriction, subject to the repayment of the equity loans.