Nearly 92% of first-time buyers in the UK rely on a mortgage to buy a property, yet only 12% use any kind of purchase scheme to help them get there. That gap tells you something important: most people are walking past help that’s already on the table. I’ve been covering the UK property market for long enough to notice a pattern — the schemes exist, the money is there, but the information is scattered across developer websites, government portals, and lender small print. Buyers end up paying more than they need to, or giving up entirely, simply because they didn’t know what was available. This article pulls the key schemes together in one place so you can see what actually applies to your situation. Here’s what you actually need to know.
If you’re looking at new builds, developer incentives can make a real difference. Some builders offer deposit top-ups of 5–10%, which can turn a thin deposit into something far more workable. A good home buying guide can help you track these offers and compare them side by side. I’d start by checking what’s available in your area before you even book a viewing.
How Real Estate Payment Schemes Actually Work
The core idea is simple: you don’t have to buy 100% of a home all at once. Schemes like Shared Ownership let you purchase a share — usually between 10% and 75% — and pay rent on the rest. The First Homes Scheme gives you a permanent discount of 30–50% on a new build, but the property stays discounted forever, which matters if you plan to sell later. The Mortgage Guarantee Scheme doesn’t give you money directly; it encourages lenders to offer 95% mortgages by guaranteeing part of the loan, so you only need a 5% deposit. Each scheme changes the maths of affordability in a different way, and the right one depends on your income, location, and whether you’re buying new or existing stock.
What I’d do first is figure out which category you fall into. If you have a 5% deposit and a steady income, the Mortgage Guarantee Scheme or a developer deposit boost could be your quickest route. If you’re a key worker or have a local connection to an area, the First Homes Scheme might offer a discount that makes a huge difference. And if you’re in Scotland, the LIFT programme works differently again — it’s a shared equity stake rather than a loan. Don’t assume one size fits all. For more on the legal side of what you’re buying, it’s worth reading about leasehold versus freehold ownership before you commit to any scheme.
Why These Schemes Matter More Now Than Ever
Since April 2025, first-time buyer Stamp Duty Land Tax relief has been removed. That means anyone buying a property over £300,000 now pays stamp duty at the standard threshold — no more exemption. For a £350,000 home, that’s an extra cost of several thousand pounds that wasn’t there before. At the same time, 27% of first-time buyers say finding a home within budget is their biggest challenge, and 21% struggle to understand mortgage options. The removal of stamp duty relief makes every pound of deposit and every discount more valuable.
Consider this scenario: a buyer in England with a 5% deposit on a £250,000 new build. Without any scheme, they need a 95% mortgage, which carries higher interest rates and stricter affordability checks. With the First Homes Scheme offering a 30% discount, the purchase price drops to £175,000. Their 5% deposit is now £8,750 instead of £12,500, and the mortgage is far smaller. That’s the difference between buying and being priced out. Regional differences matter too — in London, the income cap for First Homes is £90,000, while elsewhere it’s £80,000. If you’re in Scotland, the LIFT programme has price thresholds that vary by area, so what works in Edinburgh may not work in Dundee.
I’ve noticed that buyers often assume these schemes are only for people in dire financial straits. That’s not true. Many are designed for ordinary earners who just need a leg up. If you’re a key worker, a local resident, or someone with a small deposit but a solid rental history, there’s likely a scheme that fits. My advice: check your eligibility before you start viewing properties, not after.
Where Most Buyers Get It Wrong
The mistakes I see most often aren’t about bad financial decisions — they’re about not knowing what’s possible. Here are the four most common errors, backed by what the research shows.
Ignoring developer incentives on new builds
Many buyers focus entirely on government schemes and forget that developers offer their own help. Deposit contributions of 5–10% are common from builders like Persimmon, Bellway, and Barratt Homes. Some developers also cover mortgage payments for the first 6–12 months, or offer part-exchange deals where they buy your current home. These aren’t gimmicks — they’re genuine cost reductions. If you’re looking at new builds, always ask what incentives are available before you negotiate the price. A property lawyer can review the terms of any developer offer to make sure there are no hidden catches.
Overlooking the First Homes income cap
The First Homes Scheme offers a 30–50% discount, but you need a joint annual income of £80,000 or less (£90,000 in London). Buyers who earn slightly above that often assume they’re excluded entirely. In reality, local authorities can set their own criteria, and some areas prioritise key workers or people with a local connection regardless of income. Don’t rule yourself out without checking the specific criteria for your council. The discount applies forever, so even if you earn more later, the property stays discounted — that’s a big long-term advantage.
Assuming Shared Ownership is only for low earners
Shared Ownership lets you buy a share between 10% and 75% and pay rent on the rest. It’s available on new builds and some resale properties. The misconception is that it’s only for people who can’t afford a full mortgage. In reality, it’s a flexible option for anyone who wants a lower deposit or smaller monthly payments. You can “staircase” — buy more shares over time — so you’re not locked into the initial split forever. The rent portion is usually below market rate, which makes the maths work better than renting privately while you save for a larger share.
Not budgeting for the full cost of buying
Beyond the deposit, you need to budget for conveyancing fees (£1,000–£1,500), survey costs (£400–£1,500 depending on type), mortgage arrangement fees, moving costs, and initial furnishing. The removal of first-time buyer stamp duty relief means properties over £300,000 now attract the standard rate. A buyer who only saves for the deposit can be caught out when these additional costs appear. The table below shows typical costs you should plan for.
→ Scroll right to see all columns
| Cost Type | Typical Range | When It’s Paid |
|---|---|---|
| Conveyancing fees | £1,000 – £1,500 | During the purchase process |
| Survey (Level 2) | £400 – £800 | After offer accepted |
| Survey (Level 3) | £800 – £1,500 | After offer accepted |
| Mortgage arrangement fee | £0 – £2,000 | At mortgage application |
| Stamp Duty (over £300k) | Varies by price | At completion |
| Moving costs | £500 – £2,000 | On moving day |
What I’d do differently if I were starting over: I’d get a full breakdown of all costs before I made an offer. The deposit is only part of the picture, and the schemes that reduce your purchase price also reduce your stamp duty and conveyancing fees, because those are calculated as a percentage of the price. A lower price saves you money at every stage.
Your Step-by-Step Guide to Using Payment Schemes
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Check your eligibility across all schemes first
Don’t assume you qualify for only one. The Mortgage Guarantee Scheme is available on new builds and existing homes, so it’s the broadest option. The First Homes Scheme is limited to new builds and has income caps. Shared Ownership is available on new builds and some resales. Regional schemes like Help to Buy Wales, Scotland’s LIFT, and Northern Ireland’s Co-Ownership each have their own rules. Make a list of every scheme you might qualify for, then rank them by the total saving they offer. A homeownership grants guide can help you compare the options side by side.
Understand the Rezide equity loan option
The Rezide scheme is a newer private option that works differently from government equity loans. You put down a 5% deposit, access a 15% equity loan at a fixed 4% interest rate, and take out an 80% mortgage. It’s currently available on developments by Barratt Homes and Persimmon Homes, with Barclays and TSB as supporting lenders. The equity loan can be repaid early without early redemption charges, which gives you flexibility if your financial situation improves. This is worth considering if you have a 5% deposit but want to avoid the higher interest rates that often come with 95% mortgages.
Use the Own New Rate Reducer for lower mortgage payments
If you’re buying a new build, the Own New – Rate Reducer scheme can bring mortgage interest rates down to 2.2% or below for the first five years. That’s significantly lower than standard rates, which means lower monthly payments during the period when your finances are tightest. After five years, you revert to the lender’s standard rate, but by then you’ll have built equity and can remortgage. This scheme is separate from government help and is offered directly through participating lenders and developers.
Consider family-assisted mortgages if you have support
Not everyone has family who can gift cash, but family-assisted mortgages don’t require a gift. Guarantor-style mortgages, savings-as-security products, and family deposit accounts let a family member support your purchase without handing over money. Some lenders also consider your rental payment history as proof of affordability, which helps long-term renters who can show consistent payments. If you’ve been renting for years and paying on time, that track record can now work in your favour. For more on how family involvement affects the legal side, read about home loan co-signer requirements before you proceed.
- 1Check eligibility across all schemesList every scheme you might qualify for — national, regional, developer, and lender-led. Rank by total saving.
- 2Compare equity loan optionsLook at government equity loans, the Rezide scheme, and developer deposit boosts side by side. Check interest rates and repayment terms.
- 3Factor in all purchase costsBudget for conveyancing, surveys, mortgage fees, stamp duty, and moving costs. A lower purchase price reduces all of these.
- 4Get professional advice on the termsA property lawyer or conveyancer can review scheme terms, developer incentives, and mortgage offers before you commit.
What’s coming next — the Lloyds £5,000 deposit scheme
Lloyds Banking Group has announced a new scheme for first-time buyers on properties up to £300,000. Eligible buyers may get a £5,000 deposit mortgage, with the loan covering the rest. Shared ownership, new builds, and gifted deposits are not eligible, so it’s aimed at standard purchases on the open market. This is a lender-led initiative rather than a government scheme, and it signals that banks are starting to compete on deposit support. Keep an eye on announcements from other major lenders, as this could become a trend in 2026 and beyond.
Frequently Asked Questions
Can I use more than one scheme at the same time? ▾
What happens if I sell a First Homes property? ▾
Do I need a solicitor to use these schemes? ▾
Are these schemes available on resale properties? ▾
What if my income is above the First Homes cap? ▾
How long does the whole process take? ▾
Sources and Further Reading
Top tips for buying a house in the UK — A practical checklist covering everything from viewing to completion, including how to evaluate scheme offers.
What to know about insulation when buying property in the UK — Energy efficiency affects mortgage affordability and long-term costs, especially on older properties.
The 2026 guide to key schemes helping buyers. OnTheMarket, 2026.
Expert explains little-known house buying schemes for 2026. IFA Magazine, 2026.
First-time buyer 2026 changes, challenges, and solutions. Homeward Legal, 2026.
