Help to Buy mortgages
Your guide to getting on the property ladder with a little help from the government.
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What was Help to Buy?
Buying your first home can feel like climbing a mountain. Between saving for a deposit, figuring out mortgage deals, and dealing with rising prices, it's no surprise that many people feel stuck renting or living at home longer than they'd like. That's where Help to Buy came in handy - the government scheme designed to make home ownership a little more doable, especially for first-time buyers.
As of March 2023, the original Help to Buy scheme in England is no longer open, although many people still talk about “Help to Buy mortgages” when referring to similar options. Plus, in some parts of the UK -like Wales - versions of the scheme are still running.
Tip: If you missed out on a government bonus or mortgage guarantee scheme, there are alternatives that offer similar help, like shared ownership or low-deposit mortgages. Let's take a closer look.
How Help to Buy mortgages worked
The Help to Buy: Equity Loan scheme was aimed at helping people buy new-build homes with just a 5% deposit. The government would lend you up to 20% of the property purchase price (or 40% in London), which meant you only needed a mortgage for the remaining amount.
This lower mortgage made monthly payments more manageable and opened the door to better mortgage rates. Also, you didn't pay interest on the government loan for the first five years. After that, interest kicked in gradually, starting at 1.75% in the sixth year and rising with inflation.
Tip: Though the scheme no longer applies in England, people who used it can still keep their equity loan or remortgage. In Wales, Help to Buy – Wales is still active and works in a similar way.
What are your options now?
If you missed out on Help to Buy, don't worry - there are still ways to get support. Here are a few alternatives to consider:
Shared ownership
With a shared ownership mortgage, you buy a portion of a home (usually 25% to 75%) and pay rent on the rest to a housing association. Over time, you can "staircase" up by buying more shares in the property. This makes home ownership more affordable upfront, especially in high-price areas.
First homes scheme
This is a newer government-backed scheme offering first-time buyers a discount of at least 30% on selected new-build homes. The discount stays with the property, meaning future buyers also benefit - great if you're looking to stay in one place long term.
5% deposit mortgages
Many lenders now offer 95% loan-to-value (LTV) mortgages, especially for first-time buyers. These can be a great alternative if you've saved a small deposit but don't have access to family support or a shared ownership scheme. Just be aware that interest rates may be higher with smaller deposits.
Interest-only mortgages
These may seem attractive to first-time buyers due to lower monthly payments, but they come with risks. Unlike repayment mortgages, which gradually reduce your loan over time, interest-only deals mean you'll still owe the full amount at the end. This can be a risky option, especially if property values fall.
How to find the right mortgage for you
Even with help, choosing the right mortgage can feel overwhelming. Here are a few tips to keep it simple:
Speak to a broker
A mortgage broker can explain what deals you're eligible for and help you compare your options, especially if you're using a scheme like shared ownership or First Homes. They'll also help you avoid common pitfalls - like making a mortgage application for a property type that's not accepted.
Compare rates and terms
Look beyond just the headline interest rate. Some mortgages have fees, early repayment charges, or stricter conditions. Get further information and make sure you understand the total cost over the life of the deal, not just the monthly payment.
Think long-term
If you're using a scheme like shared ownership, consider how your needs might change. Can you afford to buy more of the property over time? Will the mortgage still suit you in five or ten years? Planning ahead can save stress later on.
Summing up
While Help to Buy as we knew it is no longer running in England, it helped thousands of people take their first step onto the property ladder - and there are still plenty of similar options out there. Whether it's shared ownership, First Homes, or a 5% deposit mortgage, you've got options. The key is knowing what's available, getting the right advice, and choosing something that works for you and your budget.
Frequently Asked Questions
Can I still apply for help to buy in the UK?
Not in England - the Help to Buy: Equity Loan scheme hasn't been open to new applications since 2023. Help to Buy – Wales is still available for eligible buyers, and alternatives like the First Homes scheme and shared ownership are available across parts of the UK.
What happens if I used Help to Buy and want to sell or remortgage?
You can sell your home or remortgage at any time, but you'll need to repay the equity loan at the current market value. This means if your home has increased in value, the amount you owe on the loan will go up too.
Do I still need a deposit with similar schemes?
Yes, most schemes still require at least a 5% deposit. The idea is to make buying more accessible - not completely free. That said, because the loan or discount reduces the amount you need to borrow, it can make the mortgage more affordable.
What's the catch with schemes like these?
While these schemes can make buying more affordable, there are some trade-offs. Shared ownership means paying rent and mortgage at the same time, the First Homes scheme can limit who you sell to and cap your resale value, and 5% deposit mortgages often come with higher interest rates and a risk of negative equity. It's important to understand the small print before committing.
Is it worth waiting for a new help to buy scheme?
There's no official replacement for Help to Buy announced yet, and it's by no means certain whether one will come soon. If you're ready to buy now and can afford it with standard mortgage options, it may be better to explore what's already out there - including other first time buyer schemes - rather than waiting around.
About the author
Lawrence Howlett
Lawrence Howlett brings a results-driven mindset to his writing, shaped by over a decade of experience across finance, legal, and energy sectors. As the founder of Moneysavingadvisors, he’s built a reputation for turning complex financial concepts into clear, actionable insights for consumers. His writing stands out for its clarity, structure, and focus on delivering value.
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