How to fund your house deposit.

They say things like ‘Move into a cheaper area’, ‘Eliminate your social life’, ‘Stop buying coffee’ – none of which sounds the least bit appealing.

So, for our guide to funding your house deposit, we’ve focused on practical advice that can help you make the most of your situation, and supercharge your savings in record time.

Help to Buy ISA

First-time buyers can put their savings into a Help to Buy ISA, and the government will top up their savings up with a 25% bonus. Save up to £200 a month (up to £12,000 in total), and you could receive an overall bonus of up to £3,000. If you’re buying with someone else, you can have one each and receive double the bonus.

Your solicitor will have to apply for the bonus shortly before completion, and you may not receive the bonus until after your purchase has completed. If that’s the case for you, use the bonus to buy furniture or pay your solicitor’s fees.

Help to Buy – Shared Ownership

In England, the government operates an official Shared Ownership scheme for buyers who are struggling to get a large-enough deposit together.

Shared Ownership means you buy a percentage of your home, and pay rent on the rest. You can often buy more, later, if your situation changes. It’s available if you’re household earns £80,000 or less (£90,000 if you’re in London).

You can take advantage if you’re a first-time buyer, or used to own a home but can’t afford to buy one now. Shared Ownership properties are often new-builds, but not always. They are, however, always leasehold.

In Scotland, a separate (but essentially identical) scheme is in place.

Help to Buy – Equity Loans

This official government scheme can also help if you’re struggling to get a deposit together.

Both first-time buyers and home movers can take advantage of an Equity Loan. You put in a 5% deposit, and the government will lend you up to an additional 20% (40% in London), fee-free, for up to five years. You then need a mortgage to cover the balance.

This schemes applies exclusively to new-build homes, and applies in both England and Wales. In Wales, the scheme is reserved for properties valued at £300,000 or less and provided by registered builders.

There’s a similar scheme in Scotland with different rules.

Gifted deposit

Otherwise known as ‘the Bank of Mum and Dad’, some mortgage lenders will accept money that you’ve been gifted by family as part of your deposit.

You may sometimes be gifted a deposit by somebody else (like a benevolent friend), or the vendor (often the builder). Depending on who it is, you may struggle to get a mortgage on this basis.

‘Gifted’ is the operative word here. If it’s a loan and you’re paying them back, you must declare this. And any repayments must be planned into the affordability calculations, to ensure you can afford your mortgage and to repay your loan.

So, if it truly is a gift, the giver may be asked to state as much in writing.

Gifted equity

Relatively few people get to take advantage of this, but gifted equity is essentially a discount off the purchase price. It applies if you’re buying a property off a family member or friend who is prepared to sell you the property below the market value.

To prove that you’re receiving a discount, the vendor will need to have had a professional valuation on what the property is truly worth on the open market.

Be aware, not all mortgage providers are happy to provide a mortgage in these circumstances.

Right to Buy discount

If you’re a council tenant, you may qualify for a 35% minimum discount on your council house or flat. The discount is larger on flats than houses, and increases if you’ve lived there for more than five years.

Right to Buy discounts are only available to council tenants in England; the scheme has already ended in Wales and Scotland.

Forces Help to Buy scheme

If you’re in the Armed Forces, you can borrow up to 50% of your annual salary (capped at £25,000) interest-free, to use towards a house deposit. The loan is then deducted from your salary over the next 10 years.

At Together, we’ll let you use two Forces Help to Buy deposits on a single purchase – helpful if you’re buying with a serving friend, or your other half is also on the MoD’s payroll.