A Picnic Guide To Mortgage Schemes

At Picnic, we believe the journey to homeownership should feel exciting, not overwhelming. And you don’t always need a large deposit or a perfect credit score to make it happen. Thanks to a bunch of smart, government-backed and private-sector mortgage schemes, getting the keys to your home could be closer than you think.

In this guide, we'll walk you through the main mortgage schemes available, explaining how they work, who qualifies, and the pros and cons of each. Whether you're buying a slice of a home or the whole thing, we’ll break everything down so you’ll be able to clearly see if there’s a route available that fits what you’re looking for. 

Shared Ownership Mortgage

Can’t afford the whole house? No problem! A shared ownership mortgage lets you buy the part you can afford—usually between 25% and 75%—and pay rent on the part you don’t own (to a housing association or council). This is why shared ownership is often referred to as part buy, part rent. 

To qualify, you’ll need a household income under £80,000 (£90,000 in London) and be either a first-time buyer, a previous homeowner who can no longer afford to buy, or someone needing a new start. The property’s held on a leasehold basis, so keep in mind extra costs like ground rent and service charges.

The best part? Your deposit and mortgage are based only on the share you’re buying, making it all much more affordable. You can also “staircase” your way up to full ownership, buying more shares over time until you own it outright.

Why It’s Great:

• Lower deposit and mortgage needed

• An affordable way to take your first or next steps toward full home ownership

• You can increase ownership at your own pace

What to Watch Out For:

• You’ll still pay rent plus your mortgage together

• Selling can be trickier, with your landlord having first refusal

• Leasehold = extra fees and charges

• Big home changes need your landlord’s approval

Sound interesting? To find out more, click on the button below to make an enquiry and speak with one of our Mortgage Experts. 

Right to Buy Mortgages

Been renting from the council for a while? You could own that place and get a healthy discount thanks to Right to Buy*. Discounts could range from £16,000 to £38,000, depending on which region of England you live in, how long you’ve been a tenant, the property’s value and the property type (house or flat).

You qualify if you’ve rented from the council for at least 3 years (not necessarily continuous), the property’s your main home, and it’s self-contained. You can use a Right to Buy mortgage to fund the purchase, and many lenders will even count the discount as your deposit.

Why It’s Great:

• You can buy your rented home at a significant discount

• Potentially no cash deposit needed

• Build equity from day one

What to Watch Out For:

• Resale restrictions can apply if selling within 5 years

• Only for eligible council tenants

• You take on all the repair and maintenance costs

Right to Acquire Scheme

If you rent from a housing association, the Right to Acquire scheme could help you buy your home at a discount of £9,000 to £16,000, depending on where you live. This is available on properties built or bought by housing associations with public funding since 1997.

You’ll need to be a public sector tenant for at least three years. The property must be self-contained, as well as your main home. The discount’s smaller than Right to Buy, so you might need more savings for a deposit or borrow more for your mortgage.

Why It’s Great:

• Discount makes buying possible

• Step into homeownership from renting

• Stay in the home you love

What to Watch Out For:

• Smaller discounts than Right to Buy

• Not all properties qualify

• Full homeowner responsibilities apply (home maintenance/repairs, insurance, etc.)

Mortgage Guarantee Scheme

The Mortgage Guarantee Scheme helps buyers secure a 95% mortgage by encouraging lenders to offer low-deposit loans. Available across the UK until June 2025, it's designed for both first-time buyers and home movers purchasing homes up to £600,000.

There are no restrictions on new-build or existing properties, but the home must be your main residence. The government guarantees part of the lender's risk, not the borrower's repayments, meaning it's essentially a standard mortgage with lender security.

Why It’s Great:

• Buy with just a 5% deposit

• Available for new and existing properties

• Widely available from high street lenders

What to Watch Out For:

• Higher interest rates on 95% mortgages

• Limited to properties under £600,000

• The government guarantee doesn’t benefit you directly

Deposit Unlock Scheme

The Deposit Unlock scheme allows buyers to purchase a new-build home with a 5% deposit and access a 95% mortgage, thanks to an insurance policy paid by participating developers to reduce lender risk. It is open to both first-time buyers and existing homeowners buying new builds up to £750,000.

You must buy from a participating builder and meet standard mortgage affordability checks. It's a private-sector alternative to the Mortgage Guarantee Scheme, focusing solely on new-build homes.

Why It’s Great:

• Buy a new-build property with a 5% deposit

• Access to competitive mortgage rates

• Open to both first-timers and movers

What to Watch Out For:

• Only works with participating builders

• Only for new builds

• Fewer lender choices than other schemes

First Homes Scheme

The First Homes Scheme offers first-time buyers in England a discount of at least 30% (up to 50% in some areas) on the market value of new-build homes. The discount stays with the property for future sales, keeping it affordable for the next buyer.

Eligibility includes being a first-time buyer, earning under £80,000 (£90,000 in London), and using the home as your main residence. Local councils can prioritise key workers and residents with a local connection.

Why It’s Great:

• Big discount on the market price

• Prioritises local and key workers

• Keeps the home affordable for future buyers

What to Watch Out For:

• Resale must be at the same discount

• Limited availability of eligible homes

• Price caps apply (£250,000 outside London, £420,000 in London after discount)

Help to Buy Scheme (Wales)

The Help to Buy scheme in Wales offers an equity loan of up to 20% towards the cost of a new-build home, meaning you only need a 5% deposit and a 75% mortgage. It's designed to help buyers purchase a new-build property in Wales priced up to £300,000.

To qualify, you must buy a new-build home from a registered builder and use it as your main residence. The scheme is open to both first-time buyers and home movers, as long as you aren't using part-exchange or buying a second home.

Why It’s Great:

Only a 5% deposit is needed

Access to new-build properties

No interest on the equity loan for the first five years

What to Watch Out For:

• Limited to properties under £300,000

• The scheme closes in 2026, reducing future flexibility

• Repayment based on property value, not original loan amount
  

How Can You Boost Your Chances?

If you're hoping to benefit from one of these schemes, there are several practical steps you can take to improve your eligibility:

• Check your credit report: Review your credit score for any errors or issues and take steps to improve it, such as paying bills on time and reducing outstanding debts.

• Save as much deposit as possible: Even if a scheme allows a 5% deposit, saving more can widen your mortgage options and reduce interest rates.

• Register on the electoral roll: This simple step improves your credit profile and helps lenders verify your identity.

• Avoid taking on new credit: Avoid applying for new loans or credit cards in the months leading up to your mortgage application.

• Use a mortgage broker: An experienced broker (like us!) can match you with lenders who accept applications under specific schemes and guide you through the process.

By preparing in advance, staying informed, and seeking expert advice, you'll give yourself the best chance of securing a mortgage and getting a step closer to owning your home.