Back in 2013 the UK government issued a scheme to help first time buyers get on the property ladder with a deposit scheme aimed to help people buy new build properties in the UK. This scheme has now been extended until the end off 2023. Using the scheme buyers can buy a new build property with as little as a 5% deposit, use an interest free loan of up to 20% from the government and then obtain a mortgage for the remaining 75% of the purchase price. This helps buyers with a small deposit or those that cant quite afford a 90-95% mortgage at this time, to still buy their dream home. 
The equity loan you receive from the government is interest free for 5 years, after which you begin to accrue interest at a rate of 1.75% per year. Most buyers fix their interest rate for 5 years to coincide with the end of their interest free timeframe on their HTB loan. When that 5 years comes to an end they remortgage their property to release equity to repay the loan before it begins to charge interest. Alternatively you can pay this off with savings or leave the loan to run and service the interest alongside your monthly mortgage payments. 
So how does the process actually work? 
• Firstly you find the property you would like to buy – this needs to be a new build or ‘brand new property’ built by a developer or builder. 
• You would reserve this property with the developer with a fee of £500-1000. 
• Speak with an independent mortgage broker to secure a mortgage in principle 
• Then you would apply for your government help to buy equity loan from the government website. 
• Once approved you can then look to submit a mortgage application for the remaining 75% of the purchase price. 
• With all 3 elements – deposit 5(%) Help to buy loan (20%) and your mortgage (75%) you can now purchase your new home! 
Things to consider: 
• This scheme is only available to first time buyers (those that have never owned a property before) 
• You must be at least 18 years of age 
• You need a minimum 5% deposit – you can go as far as 70% 
• The property purchased needs to be a new build property 
• This must be your main residence – cannot be used as a buy to let property 
• You can lend between 5% -20% for the equity loan 
• The equity loan remains at 20% of the property value. So if your loan is £20,000 today when your house is valued at £100,000 for example, when your property increases in value, your equity loan increases with it. So if you property increases from £100,000 to £120,000, your loan increases from £20,000 to £24,000. So paying your loan off as soon as possible is advised 
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