Help to Buy is a government scheme aimed at those who are finding it hard to save enough money to buy their first home or move up the property ladder.

With house prices across the UK being relatively high compared to the average salary, many people struggle to save a deposit for a house or to get a mortgage that covers the cost of a property in their area.

Unfortunately, the Help to Buy ISA will no longer be available for new applicants after 30th November 2019. It will, however, be replaced by the Lifetime ISA (LISA), a similar scheme that allows applicants to save to buy a home or for retirement.

To allow for the higher property prices in London, buyers in the capital can get a Help to Buy equity loan of up to 40% of the value of the property – also interest free for the first five years.

You will, of course, need to arrange a mortgage for the portion of your home not covered by your deposit or equity loan. Many - though not all lenders - offer Help to Buy mortgages.

Let your lender know you’ll be using the Help to Buy scheme to buy your home, and they’ll help you find the right mortgage for your circumstances.

Many property buyers wonder whether Help to Buy schemes are worth the trouble. As with any scheme or loan, there are benefits and drawbacks. Here are a few of the pros and cons of Help to Buy.

In Wales, the Help To Buy scheme allows first-time buyers to buy a new-build home for up to £300,000 with as little as 5% deposit.

The government will loan you up to 20% of the purchase price (interest-free for five years), and you’ll need to take out a mortgage on the rest.

After the first five years, you’ll be charged 1.75% interest on the loan. This will then increase by 1% plus any increase in the Retail Prices Index each year. There’s also a monthly £1 admin fee to pay.

You’ll have 25 years to pay off the loan in chunks (known as stair-casing) or all in one go. Because the loan is based on a percentage of equity (say, 20%) you could end up paying back more than you borrowed if the value of your home increases.

Who's eligible?

The Welsh Government has set its own criteria you’ll need to meet to qualify for this scheme:

• You must be buying your first home

• The purchase price must be less than £300,000

• The home must be purchased from a builder who’s registered with the scheme

• A deposit of at least 5% will need to be put down

• The deposit and mortgage must make up at least 80% of the purchase price

• The mortgage must be secured from a qualifying lender

• You won’t be able to sublet any part of your home

Further details on the scheme can be found on the Welsh Government website.

The information on this page was sourced from HelpToBuy.gov unless otherwise stated below.