We are currently undergoing our first experience with a client who wants to use ‘Help to Buy’ and the same issue has arisen at two different banks so we are comfortable that it is probably a teething issue that is live and current.
The problem is that the banks are telling us they need proof the person will qualify for the HTB scheme, but to qualify you have to have a signed contract, no borrower is going to sign a contract unless the bank will advance the loan factoring in the HTB because otherwise they may not be able to complete the loan.
The lenders had forewarned us that there would be problems, but this one seems very basic. They could just make the offer contingent on the person qualifying for the scheme. Otherwise it will mean that people are stuck waiting for the contractors name to show up on what is so far a very short list, and they are also putting the kart before the horse in terms of how it was meant to operate.
For now all we can do is highlight this catch-22 and hope it resolves itself soon!