Osborne warned over mortgages

George Osborne's Right to Buy mortgage scheme has been criticised as a "work in progress" that risks skewing the housing market at a huge cost to the Treasury.

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What is the Treasury's Help to Buy scheme?

The Help to Buy scheme explained in graphic form. Credit: Treasury

Help to Buy consists of two elements, an "equity loan" scheme and the mortgage guarantee.

Under the equity loan new or existing homeowners will need to raise a deposit of 5% of the value of the property they want to buy, but can borrow up to a further 20% from the Government on an interest-free basis. The biggest loan available will be £120,000.

The mortgage guarantee element will be available for all types of housing stock worth up to £600,000 from January. The Government will guarantee up to 15% of a mortgage, allowing people with 5% deposits access to lending.

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