A Complete Guide to Help You Get on the Property Ladder
Buying your first home can be both exciting and overwhelming. With rising house prices and high deposit requirements, many first time buyers feel stuck. Fortunately, several government-backed schemes in 2025 are designed specifically to help you overcome these challenges and make homeownership achievable.
This guide explains the latest first time buyer schemes, their benefits, eligibility, how to apply, and importantly scheme closing dates, so you don’t miss out.
Please note that government schemes and their eligibility criteria can vary depending on the country, with different rules in England, Scotland, Wales, and Northern Ireland.
1. First Homes Scheme
Affordable New-Builds for Local First Time Buyers
The First Homes Scheme enables first time buyers to buy a new-build property with a discount of 30% to 50% off the market price. The discount is locked into the property so future buyers benefit too.
When you sell a First Homes property, you must sell to another eligible first time buyer, and the same discount is retained. You must get a mortgage for at least 50% of the new build property’s value. Estate agents and developers list new build properties that qualify for the scheme.
Benefits:
- Discount of 30–50% on purchase price
- Lower mortgage and deposit needed
- Reserved for local people, key workers and low to middle earners
- Buyers achieve full ownership of the property after purchase
Eligibility:
- First time buyer with household income under £80,000 (£90,000 in London)
- Buying a home under the price cap set by the local authority: £250,000 (£420,000 in London) after the discount
- Must use a mortgage for at least 50% of the purchase
- Homes eligibility criteria include being a first time buyer, meeting local authority requirements, and joint income limits
Availability:
- No set closing date – scheme is ongoing, subject to local council and developer availability.
- Estate agents and developers list new build properties that qualify for the scheme.
2. Shared Ownership Scheme
Buy a Share and Rent the Rest
Shared Ownership lets you buy a portion of a home (as low as 10%) and pay rent on the remainder. The landlord, usually a housing association, owns the remaining share of the property and charges rent on that portion. Shared Ownership is a good alternative for those who cannot afford to buy on the open market. You can buy more of the home later (known as “staircasing”).
Benefits:
- Start with a smaller deposit
- More affordable than buying outright
- Ideal for low to moderate income households
- You can increase your property’s ownership share over time through staircasing
Eligibility:
- First time buyers or those who no longer own a home
- Income below £80,000 (£90,000 in London)
Availability:
- Ongoing with no closing date – part of the government’s Affordable Homes Programme through 2026.
3. Mortgage Guarantee Scheme
Buy with Just 5% Deposit
This scheme encourages lenders to offer 95% loan-to-value mortgages by backing them with a government guarantee.
Benefits:
- Access 95% mortgages from major lenders
- Competitive rates despite low deposit
- Suitable for new and existing properties
Eligibility:
- First time buyers or home movers
- Applies to houses up to £600,000
- Repayment mortgage only
Closing Date:
- Extended to June 30, 2025
4. Lifetime ISA (LISA)
Get a 25% Government Bonus on Your Savings
The Lifetime ISA helps first time buyers save for a deposit. You can contribute up to £4,000 each tax year and get a 25% bonus from the government.
Benefits:
- Government adds up to £1,000/year
- Tax-free interest and bonus
- Use for first home up to £450,000
Eligibility:
- Age 18–39
- Must hold account for 12 months before use
Availability:
- Ongoing – no announced end date
5. Help to Build Scheme
Support for Building Your Own Home
Offers an equity loan of up to 20% (40% in London) to reduce mortgage borrowing for self-builders.
Benefits:
- Only 5% deposit required
- Loan reduces monthly repayments
- Allows you to custom-build your home
Eligibility:
- Must intend to live in the home
- Must secure a self-build mortgage
Availability:
- Applications open and ongoing through Homes England
6. Right to Buy (England)
Buy Your Council Home at a Discount
Allows eligible council tenants to buy their rented home with a discount up to £96,000 (or £127,900 in London).
Benefits:
- Some lenders accept discount as deposit
- Instant equity in the property
Eligibility:
- Secure council tenant for 3+ years
- Main home
Availability:
- Ongoing – act early before reforms
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Understanding Deposit Requirements
Most deposits range from 5%–20% of the purchase price. For example, a £250,000 property would require at least £12,500 deposit at 5%.
Government schemes like the Mortgage Guarantee and Lifetime ISA can reduce upfront costs and make deposits more achievable.
Armed Forces Support for First Time Buyers
The Armed Forces Help to Buy scheme provides an interest-free loan of up to 50% of your salary (max £25,000) towards buying costs.
Eligibility includes six months service and intention to live in the property. Armed Forces personnel can also benefit from other schemes like First Homes.
Supporting First Time Buyer Government Schemes
- First Homes offers discounted new build properties
- Shared Ownership allows low deposits and staircasing
- Lifetime ISA gives a 25% bonus towards savings
Local councils and housing associations often add their own rules and priorities. Always check with them for your area.
Comparison Table of Schemes and Lenders
| Scheme | Participating Lenders | Notes |
|---|---|---|
| First Homes | Halifax, Nationwide, Leeds BS, Chorley BS | Needs local council/developer approval |
| Shared Ownership | Barclays, Halifax, NatWest, TSB, etc. | Staircasing supported by some |
| Mortgage Guarantee | HSBC, Barclays, Virgin, Lloyds, etc. | Scheme ends June 2025 |
| Lifetime ISA | Most major banks | Account must be open 12+ months |
| Help to Build | BuildLoan, Ecology BS, Vernon BS | Self-build only |
| Right to Buy | Aldermore, Halifax, Santander, etc. | Some accept discount as deposit |
Summary of Closing Dates
| Scheme | Status |
|---|---|
| First Homes | Ongoing |
| Shared Ownership | Ongoing – ends 2026 |
| Mortgage Guarantee | Ends June 2025 |
| Lifetime ISA | Ongoing |
| Help to Build | Ongoing |
| Right to Buy | Ongoing |
How to Get Started as a First Time Buyer
- Work with a qualified mortgage broker
- Understand which schemes you qualify for
- Plan deposit, mortgage, and avoid application delays
Final Thoughts
In 2025, first time buyers have more support than ever. Each scheme has unique rules and benefits, so planning and guidance are key.
Get Help from a Mortgage Broker
Call 01332 470400 or complete the enquiry form to speak with a whole-of-market broker who can help match you with the right lender and scheme.
Why Work with Option Finance for Bad Credit Mortgages?
At Option Finance, we specialise in mortgages for complex credit scenarios. Our team works with all major bad credit lenders and has access to exclusive deals that aren’t available on the high street.
Understanding one’s credit report from a credit reference agency can help in securing a mortgage.
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FAQs
Can I use more than one first time buyer scheme at the same time?
In some cases, yes. For example, you can use a Lifetime ISA for your deposit while also benefiting from the Mortgage Guarantee Scheme. However, not all schemes can be combined, so it’s best to check with a mortgage advisor who can guide you based on your eligibility and circumstances.
How much deposit do I need as a first time buyer
Most first time buyer schemes require a minimum of 5% of the property price. However, your deposit size may affect the interest rate and mortgage options available to you. A larger deposit often gives access to better rates.
What counts as being a 'first time buyer'?
You are considered a first time buyer if you’ve never owned a residential property in the UK or abroad. If you’re buying with someone who has previously owned property, you may not qualify for some schemes, so check the individual criteria carefully.
Are there income limits for first time buyer schemes?
Yes. Many schemes have income caps—for example, £80,000 per household outside London and £90,000 in London for the First Homes and Shared Ownership schemes. Always confirm specific thresholds when applying.
Do I need to pay back the government bonus or discount later?
It depends on the scheme. For example, the Lifetime ISA bonus doesn’t need to be repaid, but if you use the First Homes discount, the same discount must be applied when you sell the home. Shared Ownership allows you to gradually buy more of your property but may involve extra fees.
Ready to Take the First Step?
Whether you’re a first-time buyer, remortgaging, or moving home, bad credit doesn’t have to hold you back.
Understanding credit scoring can help you prepare for a mortgage application. You can speak to one of our specialist mortgage brokers who would be able to guide you through the process. They will advise if there is a lender available and the maximum loan amount based on your circumstances. We are a whole of market mortgage brokerage with access to all lenders.
