How does it work?

With a Help to Buy: equity loan the Government lends you up to 20% of the cost of your new-build home, so you’ll only need a 5% cash deposit and a 75% mortgage to make up the rest.

You won’t be charged loan fees on the 20% loan for the first five years of owning your home.

Example: for a home with a £200,000 price tag

Help to Buy Equity Loan Example

If the home in the example above sold for £210,000, you’d get £168,000 (80%, from your mortgage and the cash deposit) and you’d pay back £42,000 on the loan (20%). You’d need to pay off your mortgage with your share of the money.

For more information (including advice on fees and paying back your loan) please download our Help to Buy: equity loan buyers’ guide (PDF, 309kB)

London Help to Buy equity loan

To reflect the current property market in London, from early 2016 the government will increase the upper limit for the equity loan it gives new buyers within Greater London from 20% to 40%.

With London Help to Buy equity loan:

  • you’ll need to contribute at least 5% of the property price as a deposit
  • the government will give you a loan for up to 40% of the price
  • you’ll need a mortgage of up to 55% to cover the rest.