New government-backed 5% deposit scheme to begin April 2021
The most recent government announcement outlining the budget for the next tax year was put out today and a new mortgage guarantee scheme was announced which is set to help people with small deposits get on the property ladder.
The government will offer incentives to lenders, bringing back 95% mortgages which have dissipated during the pandemic. The new mortgage scheme will not be restricted to just first-time buyers or new build homes, but there will be a £600,000 limit. This means you can buy a home, under £600,000 with just a 5% deposit. The new scheme is set to launch from the beginning of April 2021 and will coincide with the Stamp Duty Holiday which is being extended until June 2021 (September 2021 for homes up to £25,000).
This scheme, which works in a similar way to the Help to Buy initiative that was launched in 2016 is in place to help young people get on the property ladder. The pandemic has meant it’s become increasingly difficult to buy a home and so the purpose of this incentive is to give people to opportunity to own their own home with a deposit as little as 5%.
If you’d like to know more about the Mortgage Guarantee Scheme and how it could work for you, our team are happy to help. Get in touch or find your nearest development to book an appointment today.