Help to Buy is a government scheme designed to help first-time homebuyers buy a property with a 5% deposit. You can borrow 20% of the purchase price (40% in London) interest-free for 5 years.

The government had planned to close the application channel on March 31, 2023.

The latest news is that the program will close for new applications on October 31, 2022 at 6 pm.

If you’re looking to buy a home in the near future or are looking at a property, this article will help you make your choice.

Who can apply for Help to Buy?

  • 18 years or older
  • first time buyer
  • Affordable fees and interest

You will not be able to get an Equity Loan if you:

  • owned a home or residential land in the UK or abroad
  • had any form of sharia mortgage finance

You can apply on your own or with others. All applicants must also meet the eligibility criteria above.

If you are married, in a civil partnership, or living with your partner (and you plan to continue living together), you must file a joint application.

How to use Help to Buy?

For the property you purchase with an equity loan, the property must be:

  • house is newly built
  • Sold by Help to Buy Registered Home Builders
  • The only place you own and live
  • It must not have been inhabited by anyone before you bought it.

There is also a “maximum property purchase price” limit for the home you buy, depending on the area it’s located in. You can buy a home up to the maximum property purchase price limit (including the maximum property purchase price limit).

Help to Buy

How the Help to Buy works



With Help to Buy, the government can provide you with a loan of up to 20% of the property’s value (up to 40% in London).

You only need to put down a 5% deposit and pay the rest through a mortgage.

Equity loans are interest-free for the first 5 years. After that, you’ll start paying 1.75% interest in year 6 and more each year thereafter. The amount increases every year with inflation.

You have 25 years to repay it unless you sell before then (if you sell, you need to pay off all the loan before then).

To avoid paying interest on the loan, it is best to pay it off within the first 5 years.

You need to keep in mind that the equity loan amount will vary with the value of the home.

So if the property goes up by 10% when you sell or 25 years later, whichever comes first, you will need to pay back more money to pay off the loan.

Likewise, if the value drops, your return on selling your home will decrease.

Weigh the pros and cons

While this may seem tempting, we recommend that you wisely assess whether this government program is really right for you when applying for Help to buy.


  • You only need a small deposit, so you can get on the property ladder faster
  • You can get lower mortgage rates
  • Your monthly costs for the first 5 years may be lower than if you bought the property without the program
  • You will have full ownership after repayment of the equity loan and mortgage.
  • The program is limited to newly built homes
  • Not all lenders offer mortgages to people buying Help to Buy properties. Although many big names are part of the plan
  • If the value of your property goes up, so does your equity loan repayment amount