Homeowners warned about loan '˜time bomb'
A CHARTERED surveyor is warning homeowners about a Help to Buy '˜time bomb'.
McAndrew Martin, based in Portsmouth, is forewarning those with Help to Buy loans against falling foul of an interest fees time bomb.
The firm is urging householders to check that the interest-free period on their home loan is not about to expire, as the Government led scheme nears its fifth anniversary.
The business has recorded increased instructions in property valuations as buyers have taken up the scheme, but the first borrowers will now face the end of their interest-free period.
They will need to prepare for new rates of 1.75 per cent which will rise each year by the retail price index of inflation plus one per cent.
Director of general practice Ian Lee said: ‘Some have described the loans as a ‘ticking time bomb’, but only if people don’t take any action.
‘Some householders will have already paid off their equity loan before the interest free period elapses.
‘We would urge others in the scheme to check their documents and plan ahead to ensure they avoid any unnecessary fees or costs.’