A smaller deposit. A step towards your own front door.
Find out if you could buy a new home through the Your First Home Scheme
Saving for your first home while paying rent can feel challenging. The government’s new Your First Home scheme could help eligible first-time buyers purchase a new-build home in England with a deposit from 2.5%.
At Just Mortgages, we’ll help you understand your options and prepare for your next step.
How will the scheme work?
Your purchase will combine:
- A deposit of at least 2.5%.
- A government equity loan covering 20%.
- A repayment mortgage for the remainder, from a participating lender.
The equity loan is interest-free for five years. Interest is then charged at 1.5% in year six and 3% from year seven. Interest payments do not reduce the equity loan.
When will the scheme open?
Applications are not open yet. The government’s planned timetable is:
| Stage | Expected Timing |
| Customer pre-registration | By the end of December 2026 |
| First customer applications | February 2027 |
| First property sales under the scheme | April 2027 |
Government pre-registration will not commit you to buying through the scheme. Further guidance and full terms will be published before applications open.
You can speak to a Just Mortgages adviser now to start preparing.
What could the costs look like?
For an eligible £300,000 home, your purchase could be funded as follows:
| Funding | Amount |
| Your deposit (2.5%) | £7,500 |
| Government equity loan (20%) | £60,000 |
| Repayment mortgages (77.5%) | £232,500 |
| Total purchase price | £300,000 |
Example monthly payments
This government illustration assumes a 30-year repayment mortgage at a constant 5% interest rate, with no equity loan repayments during the period shown. The standard 95% mortgage uses a 5% deposit (£15,000) and a £285,000 mortgage.
| Period | Standard 95% Mortgage | Scheme Mortgage | Equity Loan | Interest Total Under the Scheme |
| Year 1-5 | £1,530 | £1,248 | £0 | £1,248 |
| Year 6 | £1,530 | £1,248 | £75 | £1,323 |
| From Year 7 | £1,530 | £1,248 | £150 | £1,398 |
Source: GOV.UK. Figures are rounded illustrations, not a mortgage quote or available rate. Actual rates and payments may change. These figures exclude other costs, including mortgage and legal fees, insurance, council tax, service or estate charges and maintenance.
Who could be eligible?
To qualify, you will normally need to:
- Be a first-time buyer
- Buy the property as your main home.
- Purchase an eligible new-build home in England from a participating developer, within the relevant local property price cap.
- Have a total annual household income of £110,000 or less outside London, or £140,000 or less within London.
- Obtain a repayment mortgage from a participating lender, subject to affordability and credit checks.
Full eligibility rules are still to be published. A smaller deposit does not guarantee mortgage approval.
Understanding the equity loan
The government equity loan must be repaid, normally when you sell your home. You will also be able to repay some or all of it before selling, subject to the scheme’s terms.
The amount you repay is linked to your home’s value at repayment, rather than simply the amount originally borrowed.
For example, if your outstanding equity loan represents 20% of your home’s value, you will normally repay 20% of its value at the time of repayment, based on an independent valuation.
This means:
- If your home increases in value, the amount you repay could increase.
- If your home decreases in value, the amount you repay could decrease.
- Paying equity loan interest does not reduce the outstanding equity loan.
Further guidance is still due on minimum repayment amounts, valuation requirements, possible fees and how repayment will work when selling or remortgaging.
How Just Mortgages can help
Your first home starts with understanding what’s achievable for you.
Our advisers will take time to understand your income, spending, savings and plans. We’ll explain your mortgage options, help you consider the costs of homeownership and talk through how an equity loan could affect your longer-term finances.
Whether you’re still saving or already exploring new-build developments, an early conversation can help you plan with greater confidence.
Discuss your first home options
Ready to explore your options?
You don’t need to have everything worked out before getting in touch.
Speak to Just Mortgages about where you are now, what you’re working towards and the steps that could help you get there.
Government pre-registration will not commit you to buying through the scheme. You can speak to a Just Mortgages adviser now to start preparing.
Scheme information checked on 3 November 2026. Availability, eligibility and lending criteria apply. The timetable remains subject to government confirmation, and full scheme terms are still to be published.
FAQ
Will I own my home?
Yes, from completion. The government will not be a joint owner or your landlord.
Are all the terms confirmed?
No. Further guidance is due on eligibility, minimum repayments, valuations, possible fees and arrangements for selling or remortgaging.
Which homes will qualify?
Eligible new-build homes from participating developers in England, within the relevant local property price cap.
Check the government’s property price caps for your area.
Details of participating developers and lenders will be made available before applications open.
What other costs should I budget for?
Alongside your deposit, you’ll need to budget for mortgage payments, future equity loan interest, legal and mortgage fees, insurance, council tax, maintenance and any service or estate charges.
Consider whether you could afford higher mortgage payments in future. Seek financial and legal advice before committing to a purchase.
Can I speak to an adviser before I’ve saved my deposit?
Yes. An early conversation can help you understand your mortgage options, set a realistic savings target and identify steps to prepare.
Do I need to find a property before getting mortgage advice?
No. Speaking to an adviser before you start viewing homes can help you understand your potential budget and the costs to consider.