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If you are a key worker looking for a mortgage, there are several attractive options available. In fact, key workers can enjoy mortgages for up to 25% of a property’s price in certain areas. 

While key workers still get mortgages based on their ability to repay the loan and their income and expenses are taken into account when deciding on a mortgage, there are preferential rates as well as government schemes to make the process more convenient. 

Here are some of the schemes and options available to key workers:

1.       Key Worker Homebuy Mortgage
In order to secure a Key Worker Homebuy Mortgage, the process is initially the same as obtaining a regular mortgage. You must first find a property that you would like to buy, and then approach a lender to provide you with a conventional mortgage for 75% of the cost of the property. 

Once you have obtained the mortgage from your lender, you can then apply for a Homebuy mortgage, which will then cover the remaining cost of the property being bought.

2.       Shared Ownership Loans
These loans are available when purchasing part of a property owned by a housing agency, an employer or a landlord. Key workers can buy part of the property, ranging from 25% to 75%, on which the mortgage must be paid.

You will then pay rent for the rest of the property. Fortunately, you can also gradually increase ownership if your affordability allows you to, right down to full ownership of 100% of the property.

3.       New Buy Scheme
This government-backed initiative couples with specific builders and applies only when buying a property that has been recently built, like flats or houses. For a property to be eligible for the scheme, it has to be sold for the first time.

As for the borrower, it must be their only home and it cannot be used for renting out, partially or fully. As the borrower, you can not only pay a small deposit, as low as 5%, but you can also get the mortgage at a cheaper than usual interest rate. What’s more, the government covers 20% of the rest of the 95%.

However, in case the buyer falls behind on the loan repayments, the property may have to be sold at a value lower than the leftover amount of debt.

4.       Help to Buy
Focusing specifically on first-time home buyers, this scheme also focuses on newly built property and allowed buyers to acquire a 95% deposit, with a mere 5% deposit and a 20% equity loan. 

The interest on the latter does not start being charged until the 6th year when it is 1.75% and then subject to annual RPI increase. 

In the short term, it makes for convenient borrowing and is especially great for key workers who cannot afford to put down a large deposit to secure a mortgage.

5.       Right to Buy
This gives buyers of council houses the chance to purchase at large discounts. 

The scheme is aimed at council housing tenants and allows them to purchase the property that they are living in, the seller being the local authority. It is now abolished in Scotland and Wales, though it continues in other areas. 

With its primary aim to build one affordable rentable house in place of every house sold, it maintains the level of affordable housing while also providing properties for those waiting to purchase. 

Perhaps the only criticism of this scheme is that if it is resold in the first five years, the original buyer will be required to pay back the discount they initially enjoyed.

To find out the scheme that best suits you and to understand each one better, it is recommended that key workers consult an expert broker and make an informed decision before availing of the attractive buying options available to them.