How the Mortgage Guarantee Scheme works now
The current Mortgage Guarantee Scheme is a permanent government backed scheme introduced in July 2025. It is designed to support the availability of certain 91–95% loan to value residential mortgages for eligible first time buyers and home movers.
In simple terms, the scheme gives participating lenders the option to purchase a government guarantee on eligible loans. That support sits behind the lender, not the buyer, and the mortgage still needs to meet the lender’s normal affordability and underwriting rules.
This means the real question is not just whether the scheme exists, but whether it is the most suitable route for your own deposit, affordability and mortgage profile.
A MORTGAGE IS A LOAN SECURED AGAINST YOUR HOME. YOUR HOME MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON YOUR MORTGAGE OR ANY OTHER DEBT SECURED ON IT.
There may be a fee for mortgage advice. The actual amount you pay will depend upon your circumstances. The fee is up to 1% but a typical fee is 0.3% of the amount borrowed.
Who might the Mortgage Guarantee Scheme suit?
The scheme may be worth considering if you:
- Have a deposit of around 5%
- Are buying a property to live in yourself
- Are a first time buyer or home mover
- Are looking at a repayment mortgage rather than interest-only
- Want to understand whether a scheme-supported mortgage or another low-deposit option is likely to fit better.
The scheme is not for buy to let borrowing, and it is not a guarantee that every lender or every 95% mortgage will suit every buyer. Lender criteria still matter.
Do you actually need the Mortgage Guarantee Scheme?
This is one of the most important points on the page. Some buyers with a 5% deposit assume they must use the Mortgage Guarantee Scheme, but in practice the better question is whether it is the best route for your circumstances.
Depending on your income, credit profile, property type and deposit, there may be more than one low-deposit mortgage route worth considering. A broker can help you work out whether the scheme backed route is suitable, or whether a different 5% deposit mortgage may be a better fit.
That is where advice becomes genuinely useful.
How a broker can help with 5% deposit mortgages
If you have a small deposit, mortgage choice can narrow quite quickly once lender criteria, affordability and credit profile are taken into account.
A broker can help by:
- checking whether you appear to fit the scheme criteria
- comparing the Mortgage Guarantee Scheme with other 5% deposit routes
- explaining which lenders may be more suitable for your situation
- flagging any issues around affordability or credit history early
- helping package the application clearly
- guiding you through the paperwork and lender process in plain English
That matters because the value of advice here is not just “does the scheme exist?” It is which route is most likely to work for you.
Why speak to Your Mortgage Expert about the Mortgage Guarantee Scheme?
Low deposit mortgages can be more nuanced than they first appear. The right option depends on more than just deposit size.
At Your Mortgage Expert, we can help you:
- understand how the Mortgage Guarantee Scheme works
- work out whether it may be suitable for your circumstances
- compare it with other low deposit mortgages
- explain lender criteria in clear, plain English
- support you from first enquiry through to application
We help buyers across the UK by phone and video, as well as offering in-person appointments where appropriate.