The Government’s Forces Help to Buy scheme has celebrated its two year anniversary, as loans to service personnel have reached the £100m mark.
The scheme allows military personnel to borrow up to half of their salary towards buying their first home or moving up the property ladder. Since its launch, more than 6,642 personnel have bought homes, with almost 2,000 more applicants approved and awaiting completion of purchases.
The MOD unveiled the initiative in April 2014; two years on more than 6,642 personnel have bought homes and almost 2,000 more applicants have been approved and are awaiting completion of purchases.
The scheme was immediately popular – 3,220 benefitted within the first six months and by March 2015, more than £40m had been given to applicants.
As announced in October 2015 – the 18th month mark of the scheme – the MOD had loaned more than £75.7m to almost 5,000 personnel.
Defence Secretary Michael Fallon said:
This scheme has helped thousands of service families to enjoy the stability and security of owning their home. It is part of our commitment to them, in return for the immense commitment they make to us.
Under the Armed Forces Covenant, the MOD is committed to making sure those who serve are treated fairly and that the nature of their careers does not prevent them from buying a home. The scheme has proved most popular with those between the ages of 20 and 39 and the vast majority of recipients are non-officers.
Regular personnel can borrow up to 50% of their salary (capped at £25,000), interest free, to buy their first home, extend their current one or move to another property on assignment or as their needs change. The loan can be used towards a deposit and other costs such as solicitor’s and estate agent’s fees.
Chief Petty Officer Tristan Lawtey received a loan in January to enable him and his wife to purchase a home.
The 35-year-old said:
We would have struggled to get a deposit together for our own home without the scheme, and with the repayments coming straight out of our salaries it makes it really easy. The whole process was very easy to complete. All the way through the Forces Help to Buy team were really supportive, answering questions, offering advice on how to move the application forward.
Me and my wife are now in the process of re-doing the kitchen and one of the bedrooms for a home office – my wife is a self-employed architectural designer and works from home. The plan is to stay in the house until I transition out of the Royal Navy in six and a half years, and then we will assess where we want to live after that. Owning our home is going to make a real difference.
More stories from recipients can be found here.
The two-year anniversary of Forces Help to Buy coincides with the first public release of official statistics on the scheme.
The three-year scheme was designed to provide more support to personnel than its predecessor, the Long Service Advance of Pay, as it offers larger loans and is easier to apply for, particularly for those overseas.