End of Help to Buy

The part of the Help to Buy scheme designed to help first-time buyers with only a 5% deposit to put down has now finished, but there are still deals available to help people with smaller deposits.

The mortgage guarantee element of Help to Buy was originally set up to boost 95% lending. As its name suggests, the scheme provided a government guarantee to lenders prepared to lend up to 95% of the property value.

The guarantee meant that the government would compensate lenders, to help reduce their risk.

The scheme proved successful, encouraging more lenders to offer mortgages to those with only a 5% deposit to put down. Some lenders introduced 95% mortgages even without the guarantee.

The impact for first-time buyers has therefore been positive, and has given them access to a much wider choice of 95% deals, with some major lenders maintaining the rates they offer even now the scheme has ended.

Average rates on 95% deals have also fallen, although buyers must meet affordability criteria to qualify.

Those who manage to save larger deposits will have far more mortgage options available to them, but broadly it is a healthier market for homebuyers, whatever size deposit they have.