How to Avoid Delays in the Last Steps of the First Homes Scheme

Once your First Homes application is approved, there are a few final steps before you officially own your new home. These include exchanging contracts, completing the purchase, paying Stamp Duty, and understanding what happens if your circumstances change. This guide explains everything you need to know to complete the process smoothly.

Receiving Your First Homes Certificate

Once the local council approves your application, they will issue a First Homes certificate. This document confirms that you qualify for the scheme and can proceed with buying your home.

Exchanging Contracts: The Legal Commitment

How It Works

• You need to pay your deposit at the same time as you exchange contracts with the developer or seller.
• Once contracts are exchanged, you are legally committed to buying the home.
• Your conveyancer will check all legal details before proceeding.

Avoiding Fraud

Be cautious when paying your deposit, as fraudsters sometimes pose as conveyancers. You can find advice on avoiding scams on the Take Five website. Always confirm payment details directly with your conveyancer.

Important Checks Before Exchanging Contracts

Before exchanging contracts, inform your conveyancer if your circumstances have changed and you no longer meet First Homes eligibility criteria. This could affect your ability to buy the property under the scheme.

Setting the Completion Date

• If buying a new-build, the developer will set a completion date when the home is ready.
• If buying from a previous First Homes owner, your conveyancer and the seller will agree on a completion date.

This is the date when you will receive the keys and officially become the homeowner.

Completing the Purchase

On the completion date:

• Your conveyancer transfers the remaining balance to the seller’s solicitor.
• You receive the keys and can move into your new home.

Once this step is completed, you officially own the property.

Paying Stamp Duty on a First Home

How Much Stamp Duty Will You Pay?

Stamp Duty Land Tax (SDLT) is based on the final purchase price after the First Homes discount has been applied.

• If your home price falls under Stamp Duty thresholds, you may not need to pay anything.
• You can check the latest Stamp Duty rates on the UK government website.

What Happens After You Own a First Home?

Changes in Eligibility After Purchase

Once you have completed the purchase:

• You no longer need to meet First Homes eligibility criteria.
• You can continue living in the home, even if your income increases or you change jobs (e.g., you are no longer a key worker).
• You do not have to sell the home if your financial situation improves.

What If You Cannot Make Mortgage Payments?

If you fail to make mortgage payments, your lender may take legal action, which could result in:

• Repossessing the property to recover unpaid mortgage debts.
• Selling the home under First Homes rules.

Leaving a First Home as Inheritance

You can leave your home to someone in your will, but they must follow First Homes rules:

• The property must be their only or main residence.
• If they cannot meet First Homes conditions, they may have to sell the property.

After your First Homes application is approved, the final steps involve exchanging contracts, paying a deposit, and completing the purchase. Once the transaction is finalized, you receive the keys and become the legal owner. While you no longer have to meet the scheme’s eligibility rules after buying, it is essential to stay up to date with mortgage payments and understand the resale and inheritance rules. By following these steps, you can successfully own and manage your First Home with confidence.

FAQ’s