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PLEASE NOTE – Help To Buy scheme ended on the 31st October 2022 and is no longer available.

Deposit Unlock Scheme – How does it work?

The Deposit Unlock Scheme was launched in 2021 as a new option to help First Time Buyers onto the property ladder – and it’s not just for first homes. We take a look at how it works and what to be aware of.

What is Deposit Unlock?

Deposit Unlock is a scheme to help people buy a new build home with a low deposit. When you purchase a new build it’s very common for a lender to ask you for a 15% deposit or more – but the Deposit Unlock scheme makes it possible to buy with just a 5% deposit.

Deposit Unlock is the brainchild of the Home Builders Federation, which represents housing developers. To access it, you will need to find a supportive mortgage lender, as not all providers are happy to give you a 95% mortgage on a new build home.

It’s also limited to a certain number of house building companies at the moment.

How does it differ from Help to Buy?

Help to Buy is a Government scheme that is set to end in 2023 after eight years. In 2021 the Government restricted the scheme to First Time Buyers only.

Help to Buy is another scheme that allows people to buy a new build home with a 5% deposit, with the Government providing a loan to take this up to 25%. The loan is interest-free for five years.

There are three main differences between Help to Buy and Deposit Unlock. One is that existing homeowners can take advantage of the scheme, not just First Time Buyers. Secondly, there is no Government involvement. You are still loaned an amount to top up your deposit, but it all comes from your chosen bank or building society,

Finally, a Help to Buy loan is interest-free for five years, while with Deposit Unlock you are charged interest on the loan from the start.

Why can’t I borrow as much on a new build?

Many mortgage lenders will let you buy with a 10% or even 5% deposit on a standard home, but on a new build they are more cautious and often require a 15% deposit.

The reason is that some new build homes can fall in value in the first couple of years. Buying a new home that has never been lived in is very appealing to many buyers, making them more valuable. Once they are no longer brand new, the property price may drop a little.

Lenders are always cautious about negative equity, which is where the size of the debt secured on a home is actually higher than its value.

What homes are eligible?

To access Deposit Unlock you will need to buy a new home from a participating housebuilder. At the time of writing, 17 building companies are part of this buying scheme. You can check the companies that are participating on the House Builders Federation website.

Which lenders are eligible?

At present only two lenders are offering Deposit Unlock mortgages: Nationwide and Newcastle Building Society. That will make it more difficult to find a competitively priced mortgage for your circumstances, as there are fewer lenders to compare.

Is it a good idea?

In principle, the Deposit Unlock scheme is a good idea, but do bear in mind that there are plenty of buying schemes available to both First Time Buyers and existing homeowners. Terms and conditions apply with all these schemes, so it’s a good idea to explore all the options before deciding on the most suitable approach for you.

As mortgage brokers, we have a lot of experience in exploring the different schemes available on behalf of our clients – so let us take the strain out of it for you.

We’ll spend time exploring your situation and what you’re looking to achieve. Then we’ll compare all the lenders offering mortgages that will suit your needs, and recommend the most effective way forward. Contact our team for an initial chat today.

Your home may be repossessed if you do not keep up with the repayments on your mortgage.

Product Features

Our build proposition will cover new build houses and flats
For all buyers up to £833k purchase price
Deposit Unlock is owned by house builders, so here for the long term

Typical example

Cost of your new home


5% deposit


95% mortgage


Figures shown are provided for illustration purposes only. Gallagher Re is not able to give financial advice, please consult an independent financial advisor. Terms and conditions apply. The Deposit Unlock scheme is subject to the lender’s participation on selected units at eligible developments.

For full terms and conditions, please ask a sales advisor at your selected development

How to buy with Deposit Unlock

Deposit Unlock is a straightforward process that makes home ownership more affordable.