14 August 2018 ·


It’s one of the biggest announcements in recent years in the capital's property market – London Help to Buy was introduced in 2016, and now buyers within Greater London can borrow 40% of the cost of their new home.

It’s a move which is aimed at helping aspiring buyers across London take a step onto the property ladder, but how does the scheme work? Here’s our step-by-step guide.

You will need a deposit of at least 5%

A hurdle for many aspiring home owners in London is the need to save up a large deposit.

But buyers who use London Help to Buy – or the original Help to Buy scheme – only need a 5% deposit to buy a new home.

A deposit cannot be any lower than 5% with Help to Buy, but it can be higher if the buyer wishes.

The government will lend 40% as an equity loan

Outside of London, the government lends home-buyers using Help to Buy 20% of the value of their new home as an equity loan.

Within Greater London, buyers can access double the amount of equity loan – 40%. The equity loan is interest-free for 5 years.

You will need to secure a 55% mortgage

With a 5% deposit and a 40% government equity loan, buyers making use of London Help to Buy require a 55% mortgage.

A number of lenders offer specific London Help to Buy mortgages – take a look at the full list of participating lenders on the Help to Buy London website.

Am I eligible to use it if I'm not a first-time buyer?

A common misconception is that Help to Buy is only available to first-time buyers - and while it is extremely popular with those buying a first home, it is also available to home movers.

What type of home can I buy using the scheme?

The London Help to Buy scheme can be used in the purchase of a new-build home within Greater London up to a maximum value of £600,000, and all applicants will complete a full financial assessment.

What else do I need to know?

Buyers who wish to use London Help to Buy cannot part exchange their current property to use this tool, nor can they own another property.

Homes bought with the scheme cannot be sublet after purchase – the one exception is if the buyer is a current serving member of the armed forces seeking to sublet their home while away on duty.

Watch our video below, which explains how London Help to Buy works.

For further details, see our London Help to Buy page and visit the London Help To Buy website.