At least it can have a positive impact

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In the first two months of the Help to Buy scheme, 4,000 newly built homes across the country had been reserved. That is pretty impressive.

From this month buyers can choose to buy any property, new or old, and benefit from the guarantee element the Government has designed, without the uncertainty for the future of an equity loan.

I say “designed” but, seeing as information about the scheme upon launch was more than a little sparse, no one in the industry had much to go on.

Needless to say, criticism started within hours. “Housing boom,” they cried.

My main worry is just how well the new borrowers understand the scheme.

I have seen comment online indicating that some homebuilders are encouraging the applicants to only talk to their nominated mortgage broker.

Are they going to be offering the full scheme picture to the clients? Surely there is a potential conflict of interest between the developer’s chosen broker and the developer.

I have long advocated the return of mortgage indemnity guarantees to enable lenders to consider more lending at higher loan to value ratios but I remain unconvinced that the Government needs to fund them.

You will probably recall that MIGs were the norm for many years, where the borrowers paid for the policies. I have no problem with that.

Then there is the help for mortgage prisoners, who are consistently overlooked by those who continually criticise the scheme.

There will be thousands of mortgage borrowers up and down the country who have seen their equity diminish. The scheme will give them the opportunity to perhaps remortgage to gain better terms, which could in some cases help them remain in the property.

It is all too easy to knock the scheme but at least it is doing something that can have a positive impact.

Many potential first-time buyers are renting, which makes getting any deposit in place a struggle. Funnily enough, those who criticise the scheme cannot offer an alternative solution to that problem.

If people cannot buy, they have to rent. This, in turn, boosts the buy to let market, which again could cause a boom. There is no magic solution.

Yes, the previous housing boom should have been regulated better but we are where we are. Now, if George made a pledge to reform stamp duty…

Christopher Barker,

Mortgage Advice Bureau,

Todmorden.