Help to Buy mortgages

Your guide to Help to Buy mortgages

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Help to Buy is a government scheme designed to help struggling first-time buyers, or home-movers with limited equity. Under Help to Buy, you only need to stump up 5% of a home’s value as a deposit.

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The government will then step in to effectively boost this amount by way of a loan or a mortgage guarantee.


The Help to Buy: mortgage guarantee scheme closed to new loans as of 31 December 2016 as planned. For information on the other government housing schemes please visit:

Help to buy mortgages

The government-backed Help to Buy scheme is designed to help first-time buyers and those looking to move up the property ladder.

There are two parts to Help to Buy – an equity loan and a mortgage guarantee scheme. Both require the buyer to put down just 5% of the property value. 

Help to Buy: equity loan

Under the equity loan part of the scheme, when a buyer puts down a deposit of at least 5% on a new-build property, the government will then lend a further 20%, creating a total deposit of 25%. 

This part of the scheme doesn’t apply to existing properties. There’s also a maximum purchase price of £600,000.

The government's 20% slice of the loan is interest-free for the first five years. In year six, borrowers will be charged a fee of 1.75% of the equity loan amount.

Each year after year six, the fee will be 1.75% plus inflation as measured by the Retail Prices Index plus 1%. 

When you to sell the property, as it’s an equity loan (rather than a flat amount), you will have to pay the government back 20% of your home’s value at that point. This is the case whether the value has risen or fallen.

You can repay the equity loan at any time before this though, without penalty, so long as it’s in chunks of at least 10% of your home’s current market value.

To get involved, you will need to contact a Help to Buy agent in the area you want to buy, and use a participating lender. These include Santander, Woolwich, Halifax, NatWest/RBS and a number of building societies.

Help to Buy: Mortgage Guarantee

The mortgage guarantee element of Help to Buy applies to both new-build and existing homes. 

Again, buyers will need to raise 5% of the property value but this time the government will act as a guarantor for a further 15%, creating a total effective deposit of 20%. 

The idea is that interest rates offered by participating lenders will be lower, as the deposit is backed by this guarantee. However, it’s always worth checking the cost of standard 95% mortgage deals as many that sit outside the Help to Buy scheme are just as competitive.

Which banks offer Help to Buy?

Participating lenders include:

  • Barclays
  • Chorley Building Society 
  • Cumbria Building Society 
  • Leeds Building Society
  • Halifax 
  • NatWest/RBS 
  • Newbury Building Society 
  • Santander 
  • Teachers Building Society
  • Woolwich
  • Virgin Money
  • Post Office
  • Lloyds Bank
  • HSBC
  • Santander 

With both parts of the Help to Buy scheme, you won’t be able to apply if you already own a property – or if you are going to be renting out the one you are buying. And it cannot be used in conjunction with any other kind of scheme such as shared ownership.

London Help to Buy Explained

Announced in the 2015 Autumn Statement, the government’s London Help to Buy scheme launched on February 1, 2016. 

This also requires prospective purchasers to put up a 5% deposit.

Under the scheme, if you’re buying in London, you’ll be able to borrow up to 40% of the property value. That means once you factor in the 5% deposit you’ve saved, you’ll have 45% of the value of the property to put down. You’ll need to take a mortgage out for the remaining 55% of the cost.

Your mortgage must be for at least 25% of the property's value.

The scheme only applies to new-build properties worth up to £600,000 and the property you are buying must also be your only home. You cannot use the Help to Buy scheme to purchase a buy-to-let property.

You’ll only qualify for the 40% loan if you’re buying in any of the London boroughs or the City of London.

Which lenders have signed up for London Help to Buy?

There are a number of banks that offer London Help to Buy. The following is a list of the lenders that currently offer the government scheme:

  • Al Ryan Bank
  • Aldermore
  • Bank of Ireland (Northern Ireland only)
  • Bank of Scotland
  • Barclays 
  • Halifax
  • HSBC
  • Lloyds Bank
  • NatWest/RBS
  • Ulster Bank
  • Virgin Money

How do I find out more?

If you are interested in Help to Buy, you will need to start by contacting a Help to Buy agent in the area you want to buy, as they rather than lenders administer the scheme.

Visit the government's Help to Buy website.

and click on the ‘Equity loan’ tab to find details of Help to Buy agents, as well as further information on how the scheme works. 

You can find out more about government schemes to help you buy a home here.

When will Help to Buy end?

The Help to Buy equity loan scheme will finish in 2021.

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