Help to Buy details greeted with mixed reception

Concern that new scheme will not help those with low or middle incomes

The
Chancellor George Osborne has given details about the government's Help to Buy
mortgage guarantee scheme to lenders.

At a meeting at Number 11 he talked with lenders and builders about the details of how the scheme will work and how to get more first time buyers on the property ladder.

The mortgage guarantee scheme aims to support an increase in high loan-to-value mortgages for people who cannot afford large deposits.

But Jack Dromey MP, Labour's Shadow Housing Minister, said: "Any help for first time buyers struggling to get on the property ladder is to be welcomed. But there is now widespread criticism that this scheme will do little to bring the cost of housing within the reach of low and middle income earners. Unless the Government finally acts to build more affordable homes, then home ownership for millions of first time buyers will remain but a dream.

"If the £10bn infrastructure boost recommended by the IMF was spent on housing, we could build 400,000 affordable homes and support 600,000 jobs. That's the way to get people back to work, sort out the housing crisis and strengthen our economy for the long term."

Mark Clare, CEO of Barratt Housing said that the number of homes Barratt is building is already up more than 20% on two years ago due to the Help to Buy scheme. And Pete Redfern, Chief Executive of Taylor Wimpey said: "I believe that the second phase of Help to Buy will benefit the whole market, particularly existing homeowners who want to move up the housing ladder but have been unable to do so."

In addition to the criteria set out at the Budget, the rules set out on July 23 2013 aim to ensure the scheme helps a large number of people onto the property ladder while ensuring responsible lending.

Anybody wishing to borrow money will be subject to income verification and stress testing, as set out in the Financial Conduct Authority's (FCA) Mortgage Market Review. Borrowers won't be able to access guaranteed mortgages if their credit history doesn't meet FCA ‘impaired credit' standards, including having a County Court Judgment over £500 in the past three years.

Nor will people be able to use the mortgage guarantee scheme to buy second homes.

CML director general Paul Smee commented: "The mortgage market is open for business, and it is clear that government support has helped to create more favourable market conditions for home-buyers. Lenders, whether they choose to participate in the guarantee scheme or stay outside, will continue to do their utmost to meet households' needs for mortgages, but always in a way that is responsible."

Stephen Noakes, Mortgage Director at Lloyds Banking Group, said: "The Help to Buy programme is making good progress, which is very encouraging for those who are looking to buy a home, but are struggling to raise the necessary deposit. The indemnity scheme will really increase the number of options for first time buyers or home movers who need a mortgage at a higher loan to value level.

"The launch of the scheme is an important development and will give a significant boost to the housing market by addressing the issue of accessibility."

Discover more property articles at Homes and Property
Sport
Farah returns to the track with something to prove
Commonwealth games
News
John Barrowman kisses his male “bride” at a mock Gretna Green during the Commonwealth Games opening ceremony
peopleBarrowman's opening ceremony message to Commonwealth countries where he would be sent to prison for being gay
Voices
voicesGood for Lana Del Rey for helping kill that myth, writes Grace Dent
Sport
Shinji Kagawa and Reece James celebrate after the latter scores in Manchester United's 7-0 victory over LA Galaxy
football
PROMOTED VIDEO
News
Snoop Dogg pictured at The Hollywood Reporter Nominees' Night in February, 2013
people... says Snoop Dogg
Arts and Entertainment
A scene from Shakespeare in Love at the Noel Coward Theatre
theatreReview: Shakespeare in Love has moments of sheer stage poetry mixed with effervescent fun
News
Joining forces: young British men feature in an Isis video in which they urge Islamists in the West to join them in Iraq and Syria
newsWill the young Britons fighting in Syria be allowed to return home and resume their lives?
Arts and Entertainment
The nomination of 'The Wake' by Paul Kingsnorth has caused a stir
books
News
i100
Property search
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs General

Microsoft Dynamics CRM Consultant

£50000 per annum + benefits: Progressive Recruitment: Urgently seeking a Dynam...

Test Lead - Financial Reporting - Banking - London

£350 - £400 per day: Orgtel: Test Lead, London, Banking, Financial Reporting, ...

Business Analyst, Retail Bank, £375-400p/d

£375 - £400 per day + competitive: Orgtel: My client, a leading bank, is curre...

Embedded Software Consultant

£50000 - £60000 per annum + V. Competitive : Progressive Recruitment: Embedded...

Day In a Page

Screwing your way to the top? Good for Lana Del Rey for helping kill that myth

Screwing your way to the top?

Good for Lana Del Rey for helping kill that myth, says Grace Dent
Will the young Britons fighting in Syria be allowed to return home and resume their lives?

Will Britons fighting in Syria be able to resume their lives?

Tony Blair's Terrorism Act 2006 has made it an offence to take part in military action abroad with a "political, ideological, religious or racial motive"
Beyoncé poses as Rosie the Riveter, the wartime poster girl who became a feminist pin-up

Beyoncé poses as Rosie the Riveter

The wartime poster girl became the ultimate American symbol of female empowerment
The quest to find the perfect pair of earphones: Are custom, 3D printed earbuds the solution?

The quest to find the perfect pair of earphones

Earphones don't fit properly, offer mediocre audio quality and can even be painful. So the quest to design the perfect pair is music to Seth Stevenson's ears
US Army's shooting star: Lt-Col Steven Cole is the man Hollywood calls when it wants to borrow a tank or check a military uniform

Meet the US Army's shooting star

Lt-Col Steven Cole is the man Hollywood calls when it wants to borrow a tank or check a military uniform
Climate change threatens to make the antarctic fur seal extinct

Take a good look while you can

How climate change could wipe out this seal
Should emergency hospital weddings be made easier for the terminally ill?

Farewell, my lovely

Should emergency hospital weddings be made easier?
Man Booker Prize 2014 longlist: Crowdfunded novel nominated for first time

Crowdfunded novel nominated for Booker Prize

Paul Kingsnorth's 'The Wake' is in contention for the prestigious award
Vladimir Putin employs a full-time food taster to ensure his meals aren't poisoned

Vladimir Putin employs a full-time food taster

John Walsh salutes those brave souls who have, throughout history, put their knives on the line
Tour de France effect brings Hollywood blockbusters to Yorkshire

Tour de France effect brings Hollywood blockbusters to Yorkshire

A $25m thriller starring Sam Worthington to be made in God's Own Country
Will The Minerva Project - the first 'elite' American university to be launched in a century - change the face of higher learning?

Will The Minerva Project change the face of higher learning?

The university has no lecture halls, no debating societies, no sports teams and no fraternities. Instead, the 33 students who have made the cut at Minerva, will travel the world and change the face of higher learning
The 10 best pedicure products

Feet treat: 10 best pedicure products

Bags packed and all prepped for holidays, but feet in a state? Get them flip-flop-ready with our pick of the items for a DIY treatment
Commonwealth Games 2014: Great Scots! Planes and pipers welcome in Glasgow's Games

Commonwealth Games 2014

Great Scots! Planes and pipers welcome in Glasgow's Games
Jack Pitt-Brooke: Manchester City and Patrick Vieira make the right stand on racism

Jack Pitt-Brooke

Manchester City and Patrick Vieira make the right stand on racism
How Terry Newton tragedy made iron men seek help to tackle their psychological demons

How Newton tragedy made iron men seek help to tackle their psychological demons

Over a hundred rugby league players have contacted clinic to deal with mental challenges of game