Your First Home scheme explained
2.5% deposit, 20% government equity loan, new-build homes in England. Confirmed facts and what the Budget on 28 October will decide.
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Where the scheme stands
Last updated: 29 September 2026
Announced: 26 September 2026
Full details: Budget, 28 October 2026
Pre-registration: reported to open by the end of 2026
Applications and completions: start date not yet published
What the Your First Home scheme is
Your First Home is a government equity loan scheme for first-time buyers in England. It applies to new-build homes bought from developers that have signed up to the scheme.
The buyer puts down a 2.5% deposit. The government lends a further 20% of the purchase price as an equity loan. The mortgage covers the remaining 77.5%.
The equity loan has an initial interest-free period. The government has not yet said how long that period lasts or what is charged after it.
The government says buyers using the scheme could save hundreds of pounds per month compared with a 95% mortgage.
How the scheme works
Deposit
2.5% of the purchase price. That is half the 5% minimum most lenders ask for on a standard first-time buyer mortgage, and half the deposit Help to Buy required.
Equity loan
20% of the purchase price, lent by the government and secured against the home. There is no larger London loan, unlike Help to Buy, which lent 40% in London.
Income and price caps
There will be a household income cap and local property price caps. The levels will be set at the Budget on 28 October 2026. Until then, nobody can tell you whether a particular home or household qualifies.
Interest-free period
The equity loan starts with an interest-free period. Its length, and the interest rate or fees that apply afterwards, have not been published.
Developers
Developers pay a contribution when they sign up to the scheme, to help cover its costs. Only homes from developers that have signed up will be eligible.
A worked example
On a new-build home priced at £200,000:
| Your First Home | 95% mortgage | |
|---|---|---|
| Your deposit | £5,000 (2.5%) | £10,000 (5%) |
| Government equity loan | £40,000 (20%) | None |
| Your mortgage | £155,000 (77.5%) | £190,000 (95%) |
These figures are arithmetic from the published percentages. They are not an official illustration, and the monthly cost of the equity loan after the interest-free period is not yet known.
How it compares with Help to Buy
Help to Buy closed to new applications in 2023. Your First Home is a different scheme, but the shape is similar enough that the comparison is the quickest way to understand it.
| Help to Buy | Your First Home | |
|---|---|---|
| Minimum deposit | 5% | 2.5% |
| Equity loan | 20%, or 40% in London | 20%, no London uplift announced |
| Income cap | None | Yes, level to be confirmed |
| Price caps | Regional caps | Local caps, levels to be confirmed |
| Interest-free period | 5 years | To be confirmed |
What has not been published yet
The following will be set out at the Budget on 28 October 2026 or later. Anything you read that gives figures for these is a guess.
The household income cap
The local property price caps
How long the interest-free period lasts, and the rate or fees after it
How and when the equity loan is repaid
Which lenders will offer mortgages under the scheme, and their criteria
The start date for applications and completions
Whether it can be used alongside First Homes, which is a separate discounted-sale scheme
We will update this page and email everyone on the Your First Home list once the figures are confirmed.
What you can do now
Work out what you could borrow
The mortgage share is 77.5% of the price, so the borrowing question is the same as for any first-time buyer: how much can I borrow, and what does it cost each month on the mortgage repayment calculator.
Get your deposit ready
2.5% of £200,000 is £5,000. Our guide to first-time buyer deposits covers where a deposit can come from and how to build one faster.
Budget for the other costs
Stamp duty, legal fees, surveys and moving costs apply whichever scheme you use. See the costs of buying your first home and the stamp duty calculator.
Get a mortgage in principle and check your credit file
Lenders under the scheme have not been named, but every lender will assess you the same way. A mortgage in principle and a clean credit file put you in a strong position when applications open.
Speak to a whole-of-market broker
Aspect Mortgages is independent and whole-of-market, with access to 100+ lenders. When the participating lenders are announced, we will be able to compare the scheme mortgages against the whole market, including standard 95% mortgages and £5,000 deposit products, so you can see which route costs less for your home and your income.
Read the full background in our post Your First Home scheme: what first-time buyers need to know, or go back to first-time buyer mortgages.
Frequently Asked Questions
Is the Your First Home scheme open yet?
No. It was announced on 26 September 2026 and the full details will be set out at the Budget on 28 October 2026. Pre-registration has been reported to open by the end of 2026. The start date for applications and completions has not been published.
How much deposit do I need?
2.5% of the purchase price. On a £200,000 home that is £5,000.
How big is the government equity loan?
20% of the purchase price. On a £200,000 home that is £40,000. The mortgage covers the remaining 77.5%.
Is the equity loan interest-free?
It has an initial interest-free period. The government has not said how long that period is or what is charged afterwards.
Can I use it on any home?
No. It is for new-build homes in England, bought from a developer that has signed up to the scheme.
Is there an income limit?
Yes. There will be a household income cap and local property price caps. The levels will be announced at the Budget on 28 October 2026.
Is it the same as Help to Buy?
No. Help to Buy closed in 2023. Your First Home has a lower minimum deposit (2.5% rather than 5%), no larger London loan, and will have an income cap that Help to Buy did not. The interest-free period has not yet been set; Help to Buy's was five years.
Which lenders will offer Your First Home mortgages?
Not yet announced. As a whole-of-market broker with access to 90+ lenders, we will compare the scheme lenders against the rest of the market once they are named.
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