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Equity Loan

Help to Buy Equity Loan

Adam & Orsolya sit in their new home thanks to Help to Buy Equity Loan


The Help to Buy Equity Loan scheme is open to both first time buyers and existing homeowners. There is no income cap for applicants and you can buy a new-build property with a value of up to £600,000. The scheme helps you to buy your home with an equity loan of up to 20% of the full price of the property. You won't have to pay any interest charges on this loan for the first five years and you own 100% of your own home from the start. Click here for more information.


Help to Buy Equity loans allows you to put a 5% deposit forward and the Government and the lender to pay help you with the rest.

How does the Equity Loan work?

You buy 100% of a new home from a registered developer, but it's more affordable because you only have to raise 80% of the purchase price yourself initially.

The remaining 20% is covered by an 'equity loan' from the government. This loan is 'interest free' for the first five years. From year six, you'll start paying a monthly fee.

You'll need to be able to find at least 80% of the property price through a conventional mortgage with a lender. But lenders usually require you to have a deposit of at least 5%, your mortgage will typically be for 75% of the purchase price.

How do I find a Help to Buy Equity Loan property?

Help to Buy Equity Loan properties are available from participating registered developers. Properties up to a value of £600,000 can be included in the scheme. You can find details of registered developers offering Help to Buy properties across the midlands here or through our online property search.

How do I apply for Help to Buy Equity Loan?

When you have found a suitable property (which is a newly built property from a participating registered developer) you will need to follow these steps:

At present part exchange is not available on the Help to Buy Equity Loan scheme. Your Help to Buy Equity Loan property must be your only property by the time of purchaser legal completion.

Repaying the Equity Loan

The Help to Buy Equity Loan will be interest free for the first five years; from year six a fee applies which increases annually by RPI +1% from year seven. The total amount you'll pay back on the equity loan relates to the property's market value at the time of repayment.

So if the value of your home goes up, the amount you pay back also goes up. If the value of your home goes down, the amount you pay back also goes down, so you are protected if the market falls after you buy.

You must pay back your Equity Loan within 25 years or if you move, whichever is sooner.

More information is available in the government's Help to Buy Buyer's Guide.

I am a developer wishing to register for Help to Buy Equity Loan funding

Homes and Comunities Agency's logo linking you to the HCA website on Help to Buy If you are not already signed up for funding, you can find the registration document and submission forms at Homes and Communities website.

Developers can contact the HCA regarding Help to Buy at helptobuy@hca.gsi.gov.uk. Please note this e-mail address is only for developers with queries relating to Help to Buy Equity Loan, not for general enquiries.

For guidance on developer participation please read this report.