Eligibility criteria apply
To qualify, customers must apply for a first-time buyer (FTB) mortgage with Halifax or Lloyds Bank, have a total employed household income of £50,000 or more, have a loan-to-value on their chosen property of up to 90%, and not be currently using shared ownership or shared equity.
Under the new deal, the maximum loan available will rise from approximately £224,500 to around £275,000, allowing buyers to secure their first home with a smaller deposit. This could be particularly beneficial ahead of a drop in the FTB Stamp Duty exemption - from £425,00 to £300,000 - due at the end of March 2025.
Buying and selling property
We want to help make everyone's property purchase go as smooth as possible. Our guides provide an insight into the whole process whether looking to get on the property ladder, choosing a solicitor or overcoming financial hurdles.
Market pressures
Rising house prices, living costs, high interest rates and affordability challenges mean conditions are the most difficult in 70 years for people hoping to get onto the property ladder.
According to some estimates, more than half of FTBs now need a loan of more than 4.5 times their income, rising to 80% in London.
Other support for FTBs
For people with lower household incomes, and those struggling to raise a deposit, several government-backed schemes are available to help them buy their homes.
These include Shared Ownership, where the buyer purchases between 25% – 75% of the property and pays rent on the remaining share, Help to Buy Equity Loans, where the UK Government provides a loan to cover part of the property's cost, and the Right to Buy scheme which allows tenants in council or housing association properties to buy the home they live in.
Additionally, in the 2023 Autumn Statement, the then Chancellor, Jeremy Hunt, MP, extended the mortgage guarantee scheme until the end of June 2025. The scheme incentivises lenders to offer 95% loan-to-value mortgages by compensating them for some of their losses in the event of a repossession. For buyers, this means more choice of mortgage products with a 5% deposit.
First-time buyer schemes
Take a look at all the first-time schemes available and how they differ depending on where in the UK you are planning on buying your home.
It is encouraging to see banks offering help to first-time buyers at a time when many continue to struggle to take their first step onto the housing ladder, and it will be interesting to see what long-term benefits this scheme may generate.
We now need to see more homes being built to keep up with rising demand as this will bring down prices in the long-term and make homeownership more affordable for all.
