Help to Buy, Lifetime ISA and First Homes: A Guide to UK Buyer Schemes
Saving for a deposit and getting a mortgage is the biggest hurdle for most first-time buyers in the UK. To help bridge the gap, the government has introduced a range of schemes over the years aimed at making homeownership more accessible. Some of these schemes are still active, others have closed to new applicants, and the eligibility rules vary significantly.
Here's a clear guide to the main schemes available to UK first time buyers in 2026.
Lifetime ISA (LISA)
The Lifetime ISA is one of the most useful tools available to first-time buyers saving for a deposit. You can save up to £4,000 each tax year, and the government adds a 25% bonus on top, up to £1,000 per year.
To open a LISA you need to be aged between 18 and 39, and you can keep paying in until you turn 50. The funds and bonus can be used towards a first home up to £450,000, or saved towards retirement.
The catch is that if you withdraw the money for any reason other than buying your first home or retirement after 60, you pay a 25% withdrawal penalty, which actually leaves you worse off than if you'd just saved the money in a normal account. So a LISA only really makes sense if you're committed to using it for a first home or retirement.
First Homes scheme
The First Homes scheme offers eligible first-time buyers the chance to buy a new build property at a discount of at least 30% compared to the market price, with some local authorities offering up to 50%.
To be eligible you must be a first-time buyer, aged 18 or over, with a household income below £80,000 outside London or £90,000 in London. You also need to be able to get a mortgage for at least half the discounted price.
The discount stays with the property in perpetuity, which means when you come to sell, you must sell at the same percentage discount to another eligible buyer. This protects the scheme but does limit your potential capital gain (the amount of profit you can make if the property price increases) compared to a standard purchase.
First Homes are typically released by housing developers as part of new build developments, so availability depends on what's being built in your area.
Mortgage Guarantee Scheme
The Mortgage Guarantee Scheme is a government-backed initiative designed to encourage lenders to offer 95% mortgages to buyers with smaller deposits. The government provides a guarantee to the lender, reducing the lender's risk.
The scheme is available for any property purchase up to £600,000 (whether new build or existing), and you don't need to be a first-time buyer to qualify. The mortgage itself is a standard repayment mortgage, just with the government providing a guarantee in the background.
The scheme has been extended several times and is currently available, though it's worth checking the latest position before relying on it.
Shared Ownership
Shared Ownership lets you buy a share of a property, typically between 10% and 75%, and pay rent on the remaining share. Over time you can buy more shares in a process called staircasing, eventually owning the property outright.
It's aimed at buyers who can't afford to buy a similar property outright on the open market, with a household income limit of £80,000 (or £90,000 in London).
We covered Shared Ownership in detail in our guide to shared ownership, including the hidden costs and the questions to ask before committing.
Help to Buy: Equity Loan (closed to new applicants)
The Help to Buy Equity Loan scheme closed to new applicants in October 2022, but you may still come across references to it. If you bought a property using Help to Buy, you'll need to be aware of the equity loan repayment rules and how interest builds up after year five.
If you're not already in the scheme, it's no longer an option. The equivalent today is closer to the First Homes scheme or the Mortgage Guarantee Scheme.
Stamp duty relief for first time buyers
This isn't a scheme as such, but it's worth knowing about. First time buyers in England and Northern Ireland pay no stamp duty on properties up to £300,000, and 5% on the portion between £300,000 and £500,000. Properties over £500,000 don't qualify for first time buyer relief at all.
We covered the full picture in our guide to stamp duty.
Which scheme is right for you?
The right scheme depends on your specific circumstances. If you're saving for a deposit and at least a year away from buying, opening a Lifetime ISA is almost always worth doing for the government bonus. If you're looking at new build properties, the First Homes scheme could offer a meaningful discount. If you have a smaller deposit and want a 95% mortgage, the Mortgage Guarantee Scheme broadens your options. If you can't afford to buy outright in your area, Shared Ownership might be the realistic route in.
Most schemes can be used in combination, so it's worth speaking to a mortgage broker who specialises in UK buyer schemes to understand what works best for your specific situation.
The full checklist
The Home Truths Guide includes 100+ essential questions to ask at every stage of buying a home in the UK, covering house viewings, making an offer, surveys, conveyancing, special circumstances and exchange and completion.
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