Help to Buy’s reach expands among buyers and lenders

The statistics, published jointly by the Prime Minister’s Office, the department for community and local government and HM Treasury on 2 January, showed 4000 more people have applied for Help to Buy mortgages since November, when initial figures indicated an uptake of 2000 in the first month of the scheme.

The value of loans issued to hopeful buyers since then was £1bn. The number of people who have completed the home-buying process, however, currently stand at a more modest 750, according to the figures.

Prime Minister David Cameron said Help to Buy had gone a long way to help those “frozen” out of the housing market due to onerous deposit requirements.

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The government also confirmed an extra 20,000 households have benefited from the Help to Buy equity loan scheme, a separate and earlier venture designed to boost the flagging market for new-build homes by offering buyers a loan worth up to 20 per cent of the asking price in return for a 5 per cent deposit.

It also estimated that two-thirds of the mortgage market will be geared up to sell Help to Buy mortgages by the end of the month, with Barclays, Santander and Natwest set to join shortly. Ranks currently include Aldermore, Virgin Money, RBS, Lloyds, Halifax and HSBC.

Meanwhile, Wales has launched its own housing lifeline for buyers interested in homes worth up to £300,000. Buyers must have a 5 per cent deposit if they wish to apply for a government-backed loan worth up to 20 per cent of a property’s value.


– Brian Murphy, head of lending for the Mortgage Advice Bureau, said: “Even lenders that don’t engage with Help to Buy can benefit from improved funding markets and an increased appetite for high loan-to-value loans.”

– Jeremy Duncombe, director of Legal & General Mortgage Club, said: “Despite this good news, the mortgage market is recovering at different rates across the UK. Initial figures showed that more than three-quarters of applications came from outside London and the South East, highlighting the fact that there remains a real need for assistance in many of these areas.”

– Alex Reynolds, IFA for London-based Advies Private Clients, said: “More lenders coming onto the market will help ease lending restrictions as banks no longer have to worry about volume of business. Up to now, I have heard borrowers having great difficulty with strict credit scoring with the scheme.”