| The Mortgage Guarantee Scheme is now permanently available across the UK | Lenders are insured against losses, supporting availability of high LTV mortgages | When borrowing at higher loan-to-value levels, it’s important to tread carefully |
The government’s new Mortgage Guarantee Scheme became permanently available in July 2025.
The scheme, which was part of Labour’s election manifesto, aims to sustain availability of 91-95% loan-to-value mortgages. Lenders are incentivised with a government-backed guarantee, insuring them against a portion of their potential losses on those mortgages. The Mortgage Guarantee Scheme is offered to FTBs and home movers.
When publishing information about the scheme, the Treasury said, ‘The government recognises the difficulties that many aspiring homeowners face in getting on the housing ladder – in particular, the challenge of raising a sufficient deposit for a home.’
A mortgage guarantee scheme was first implemented by Boris Johnson’s Conservative government; it accounted for approximately 53,250 mortgage completions between its launch in 2021 and the end of 20241. Most of these purchases (86%) came from FTBs and were in the North West, South East or Scotland.
When borrowing at higher loan-to-value levels, it’s important to tread carefully. With less equity in your home, you could be more exposed if property prices fall. Taking advice before committing can help ensure you choose a deal that balances interest rate, fees and suitability for your circumstances.
The Scheme is applicable in Scotland and Northern Ireland, in addition to England and Wales, with a few small modifications relating to terminology.
1HM Treasury, 2025
As a mortgage is secured against your home or property, it could be repossessed if you do not keep up mortgage repayments.