The Help to Buy mortgage guarantee, launched early in October, has been designed to help borrowers buy a home with a deposit of as little as 5% of their property’s value.

RBS and NatWest were among the first banks to offer the Help to Buy mortgage guarantee and have helped 1,075 customers complete mortgage applications worth a total of £171.6m, with 169 already approved and ready for the drawdown of funds.

Help to get on the property ladder

Although the mortgage guarantee scheme applies to all buyers and all types of home worth up to £600,000, the majority of applicants have been young first time buyers on a roughly average UK income.

Prime Minister David Cameron said: “This is about helping hardworking people get on the first rung of the property ladder – and helping them get on with life”.

“Owning a home is about more than having four walls to sleep at night. It’s about independence, self reliance, moving on and moving up. Above all, it’s about aspiration. Help to Buy is helping people realise the dream of home ownership.”

Of the 1,075 RBS and NatWest applicants, the majority are couples applying for an average mortgage of £159,000 to buy a home worth an average of £167,565, based on a joint salary of less than £50,000. This is below the UK average price of £247,000.

Three quarters are first time buyers and in their early thirties, and the majority have just one child or no children at all. The highest numbers of applications have come from the North West, South East and Scotland.

Straightforward to apply

Hayley and Struan Preston (pictured), a sister and brother from Edinburgh, were the first RBS customers to complete on buying their new home using a Help to Buy mortgage guarantee.

The siblings, along with several other Help to Buy mortgage borrowers, visited Downing Street on the one month anniversary of the scheme’s launch to tell David Cameron about their experience.

Struan says: “We went into the bank branch for a normal mortgage, but it was the first day of Help to Buy mortgage guarantee, and the scheme meant we could apply for a bigger mortgage. It’s been a big help.”

The application took one and a half hours to complete, but was very straightforward, says Struan.

The siblings have used their mortgage to buy a flat in Morningside, Edinburgh.

Josh and Bethany Riley, newlyweds and first time buyers Darwen in Lancashire who also attended the Downing Street reception, said Help to Buy had been a dream come true for them. “Thanks to this wonderful opportunity we will be on the property ladder and in our own home for Christmas 2013”

Equal opportunities

The Government says that a mortgage worth 95% of the property’s value has been the route to home ownership for most first time buyers for the past 30 years. This means that Help to Buy is giving today’s first time buyers the same opportunity to secure a home as their parents and grandparents.

The scheme has already seen applications for 95% mortgages “massively increase the size of the market”.

RBS aims to help 25,500 first time and next time buyers through the Help to Buy mortgage guarantee scheme during the next three years.

Lloyd Cochrane, Head of Mortgages at NatWest and RBS, said: “Four weeks ago I said that we wanted to help as many customers as possible to take that important first or next step on the property ladder.

“We’ve been helping over 1,000 customers with their application and we’re already seeing some move into their new home. The majority of these are first time buyers who, without Help to Buy, wouldn’t have been able to consider a mortgage or buy a home and we’re committed to helping as many more customers as we can.”

RBS has already provided £58.5m in mortgage lending through the Help to Buy shared equity scheme launched earlier this year, and has helped nearly 12,000 people buy their first home since January.

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