But it's the cost of the government's 20% slice of the loan that's really competitively-priced. For the first five years, it’s interest-free. In year six, you will be charged 1.75% which will climb at a rate of 1% of that figure plus any increase in inflation (as measured by the Retail Prices Index (RPI)), every year thereafter.
20% is a huge amount (and 40% in London). Soon lots of people are going to have to pay the amount back or face having huge ever increasing interest.
I don't think it was ever to help people, just to help the housing companies and keep the housing bubble inflated. All the housebuilders shares rocketed when the scheme was aannounced and extended. Prices have increased as affordability was increased due to this scheme, so it's hasn't helped anyone but big companies selling houses and banks selling debt imo.
I think many will not be saving like mad to pay it off. Just like how so many with interest only mortages have no plan to pay back the capital.
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To think help to buy is a disaster waiting to happen
53 replies
Ninmpy · 29/06/2018 07:57
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