High street and specialist mortgage lenders have begun preparations for the end of Help to Buy by looking at alternative schemes and products to help buyers on to the ladder.
Speaking on a panel at The British New Homes Mortgage Senate, mortgage bosses revealed the industry’s plans to fill the gap left by Help to Buy when the scheme ends in 2023.
As part of the plans it was revealed that UK Finance has met with trade body the Home Builders Federation to investigate ways lenders and builders can work together to support buyers after the government scheme has ended.
One senior representative of a major lender, speaking at the Chatham House rules event, said schemes where builders and lenders could share in the risk of higher loan-to-value lending would be favourable.
However, they urged the industry to avoid developing short-lived schemes that will disappear within two years.
Private shared equity schemes, adding 95 per cent new-build deals to product ranges and lending on homes built using modern methods of construction are also some of the alternatives being reviewed by building societies, banks and specialist lenders.
Expanding criteria to allow joint borrower, sole proprietor arrangements to help with deposit and affordability issues was at the top of one building society’s agenda.
UK Finance said it did not wish to comment on the report.
From 2021 to 2023 Help to Buy will only be available to first-time buyers.