250m scheme helps house buyers

A £250 million scheme to help up to 10,000 first-time buyers purchase a new-build property has been announced in the Budget.

Chancellor George Osborne revealed that household with incomes under £60,000 will be eligible to seek help from the FirstBuy initiative to let them take their first step on the property ladder.

Under the plans, buyers must provide a 5% deposit of the property's value, with the Government and housebuilders giving 10% each to allow consumers to access a 75% loan-to-value mortgage. There will be no interest on the loan for the first five years, with rates of 1.75% in year six and 1% above inflation thereafter.

Ministers hope that the scheme, which is almost identical to the Homebuyer Direct scheme launched by the previous government in 2009, will provide a boost to the construction industry and help safeguard jobs.

The Council of Mortgage Lenders welcomed the announcement, saying it would provide "modest help" for first-time buyers.

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