The Forces Help to Buy Scheme.
Are you serving in the British Armed Forces and want to know how to get onto the property ladder with less than a quid in your bank?
The Forces Help To Buy Scheme (FHTB) is a government backed scheme which helps serving personnel buy their first home. The scheme was launched in 2014 and has recently been given the green light to remain until at least 2022.
How Does The Forces Help to Buy Scheme Work?
The scheme enables you to borrow up to 50% of your current annual salary (before tax & any deductions). With the maximum amount you can borrow capped at £25,000.
It was introduced to help first time buyers, and, in some situations, the money can be used to extend or modify your current home.
The Forces Help to Buy Loan is to be used for the purchase of property, for the immediate occupation of the serving individual or their family members and cannot be used for a buy to let property. After an initial period of 12 months, you can then rent out your property.
What Can The Forces Help to Buy Loan Be Used For?
Good news for you, the loan can be used to pay for the purchase price of the home, it can also be used for all the other fees required when purchasing a new home, including surveyors’ fees, solicitors’ fees, land registration and the deposit.
Majority of high street banks and mortgage lenders will accept the Forces Help to Buy scheme loan and will take this into account when you apply for a mortgage.
Can I Leave The Armed Forces After Receiving a FHTB Loan?
This is the bit the MoD would want me to leave out … YES, yes you can leave the forces after receiving this army help to buy loan. Yes, even if you still owe money. However, there is a caveat. If you are due any resettlement grant, they have a right to take any remaining balance from it, they also have the right to take your final months’ salary.
Once you have left the forces, you are obligated to setup a monthly payment plan to settle any remaining balance owed.
Who Is Eligible To Apply For FHTB Scheme Loan?
The scheme requires you to be in regular service, have served at least two years from your date of enlistment and for those at the end of their careers, you will require to have at least six months remaining in service.
How Much Do I Have To Pay Back?
It will all depend on how much you borrow, but your total amount borrowed will be divided over 10 years and deducted from your salary each month.
The best thing about it, you pay 0% interest on the loan.
You have three options to start paying back the money:
Immediately upon receiving the loan.
Six months after you’ve received the loan (to give you some breathing space).
For those still in their early years, you can opt to only start paying back in your final 10 years of service.
How Do I Apply For The Forces Help to Buy Scheme?
You can apply for the Forces Help to Buy scheme using JPA through the Self-Service Application. Surprisingly, it is easier to apply for FHTB than it is to claim for a missed meal. Click on the tab – ‘Applying for Pre-Approval for FHTB’.
If you have all the correct info to hand, it takes less than 20 minutes to fill out the application. It usually only takes around a few hours to get back a response for pre-approval.
Does The House Have To Be New Build Home?
No. With Forces Help to Buy, you have the decision on what type of property you wish to buy. Unless you are using any other form of government backed scheme, then you may be required to buy a new build home.
Are There Any Hidden Costs?
Surprisingly, No. The money is loaned interest free, the only extra payment you make is around £7.50 added each month for insurance.
Do I Need To Be Married or Have Children To Apply For FHTB?
No. This is not the case. Anyone who meets the above criteria is eligible to apply for the armed forces Help to Buy scheme.
Forces Help To Buy Scheme (FHTB) Contact Detail and Address
To speak to the Forces Help to Buy scheme team, contact the JPAC enquiry centre on: 0141 224 3600 select option four then choose the relevant service.
Defence Business Services Military Personnel, FHTB Section, Centurion Building, Grange Road Gosport, Hants, PO13 9XA.
For the most up to date advice and guidance about FHTB Scheme, check the Joint Service Publication (JSP) 464 or speak to a specialist military mortgage adviser.
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