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Help to Buy mortgage guarantee launches

The Government's £12 billion Help to Buy mortgage guarantee scheme - designed to help thousands of people with small deposits get onto the housing ladder - has launched three months ahead of schedule.

Natwest, RBS, Halifax and the Bank of Scotland will offer the mortgages from this week, with more banks following suit in the New Year.

The Help to Buy mortgage guarantee scheme will:

  • enable lenders to offer mortgages worth up to 95 per cent of a property's value on homes worth up to £600,000
  • allow buyers to get onto the property ladder with deposits of as little as five per cent of the property's value
  • guarantee up to 15 per cent of the property's value to the lender.

Launching the guarantee, Prime Minister David Cameron said: "Too many hardworking people are finding it impossible to buy their own home - people who can afford the monthly mortgage payments but haven't got rich parents and can't pay the deposit up front."

"Help to Buy is going to make the dream of home ownership a reality for many who would otherwise have been shut out. This goes right to the heart of my vision for Britain - a country where everyone who works hard can get on in life."

The first part of the scheme, which provides equity loans, launched earlier this year and has already helped 15,000 people buy a new home, according to the Government.