The second stage of the much talked about Help to Buy scheme launched on Monday, three months earlier than planned.

Initially set for a January launch, the £12bn scheme is now available through Natwest, RBS, Virgin Money, Halifax, Santander and Bank of Scotland. The second stage of Help to Buy allows mortgages up to 95 per cent of the property’s value to be taken out for new build and second-hand homes up to the value of £600,000, with a deposit of only 5% needed.

Under the scheme the government will guarantee up to 15 per cent of the property’s value. Unlike the first part of the scheme, which was restricted to new build houses and offered a 20% government loan, which is interest-free for five years, lenders will charge interest rates on the scheme.

On announcing the launch, the Chancellor of the Exchequer, George Osborne, said: “Too many people are still being denied the dream of owning their own home, which is why we have brought forward the launch of this scheme, so as of today borrowers can start applying for a mortgage with a five per cent deposit.”

The government will begin to underwrite the risk for lenders from January but expects any applications take a few months to process. However, any completions before January will be honoured by the scheme.

If you are looking at using the scheme, trust Paul Crowley & Co to look after the legal aspect of the residential transaction. Contact our Conveyancing Solicitors on 0151 264 7363