Stronger Support for First-Time Buyers as Mortgage Scheme Becomes Permanent

This month, the Treasury confirmed that the Mortgage Guarantee Scheme will be made a permanent fixture, as Chancellor Rachel Reeves underlined the Government’s renewed commitment to supporting first-time buyers.

Speaking ahead of her Mansion House address, the Treasury introduced fresh measures designed to help more people take their first step onto the property ladder. The initiative includes a directive for regulators to promote economic growth through improved access to lending.

Following guidance from the Bank of England, lenders are now expected to offer more mortgages at over 4.5 times a buyer’s income. This move could unlock up to 36,000 additional mortgages for first-time buyers over the next 12 months.

Nationwide is among the first to respond, widening access to its ‘Helping Hand’ mortgage. As of today, individuals earning £30,000 (previously £35,000), and joint applicants earning £50,000 (down from £55,000), will be eligible, potentially aiding 10,000 more buyers each year.

By making the Mortgage Guarantee Scheme permanent, the Government delivers on its promise to ensure high loan-to-value mortgages remain accessible, particularly in uncertain markets. The Financial Conduct Authority is also reviewing lending criteria, with plans to allow rent payment history to support affordability assessments.

Chancellor Reeves commented: “I welcome the recent changes the Financial Policy Committee has announced to the loan-to-income limit on mortgage lending, which the Prudential Regulation Authority and FCA are implementing immediately.

With an instant impact for consumers, such as Nationwide offering its ‘Helping Hand’ mortgage to more first-time buyers, supporting an additional 10,000 each year.”