Deposit Unlock

For the past seven years, the government’s Help to Buy scheme has been the driving force behind high loan-to-value (LTV) new-build lending. However, the scheme became more restricted in 2021, available only to first-time buyers, and with the introduction of regional price caps.

Given these changes, and the end to the scheme in March 2023, a group of 17 property developers—part of the trade body, Home Builders Federation (HBF) —recognised the need for a private sector mortgage guarantee scheme as an alternative.

This is where Gallagher Re, the reinsurance division of Gallagher, is providing support for a new low-deposit mortgage solution by way of an insurance-backed scheme.

Interested in joining the scheme?

Gallagher Re and the Home Builders Federation working together

On behalf of the 17 property developers, the HBF commissioned Gallagher Re to design, initiate and implement a private sector solution to galvanise the high LTV lending space and fill the void left behind by Help to Buy. The solution Gallagher Re designed is Deposit Unlock—enabling first-time buyers to purchase a new-build home with a small deposit.

Deposit Unlock provides mortgage insurance to lenders, to allow them to lend on new-build housing, with a 95% loan-to-value ratio, with reduced risk exposure.

Gallagher Re administers the Deposit Unlock scheme on behalf of HBF members.

Deposit Unlock—a low deposit mortgage solution for new-build homes

Deposit Unlock enables both those buying their first home, and existing homeowners, to purchase a new-build home with just a 5% deposit mortgage at competitive interest rates* issued by the lenders. This is achieved via an innovative insurance-led solution that was collaboratively built with lenders and the housebuilding industry, and led by the HBF (England and Wales), and Homes for Scotland.

This house builder owned scheme has been highlighted as the dominant low-deposit mortgage scheme to replace sales in a post Help to Buy market in 2023.**

After a successful pilot scheme, low-deposit mortgages through Deposit Unlock are now available through Newcastle Building Society, Nationwide and Accord Mortgages. We are also in the process of taking on 50+ new developers across the UK who wish to make use of the scheme immediately, and post Help to Buy.

Deposit Unlock will substantially increase access to new-build home ownership, backed by reinsurance and supported by mortgage providers. It is a fantastic example of what can be achieved through private-sector collaboration between house builders, lenders and the insurance industry.

*Nationwide’s Deposit Unlock 3.19% 5-yr fixed rate is 0.21% below the market average (Mortgage Strategy Rate Watch, 8 April 2022).

**Savills. Support for new homes sales: life after Help to Buy. 26 January 2022.

Participating home builders: Participating lenders: Trade bodies:
Barratt Developments (BDW Trading Limited) Newcastle Building Society HBF
Bellway Homes Limited Nationwide HfS
Bewley Homes PLC Accord Mortgages
Bloor Homes Limited
City & Country Homes
Countryside Properties (UK) Limited
Crest Nicholson Operations Limited
Croudace Homes Ltd
Davidson Developments Limited
Devine Homes PLC
Edenstone Holdings Ltd
Fairview New Homes Limited
Hill Holdings Limited
Keepmoat Homes Limited
Mandale Homes Holdings Limited
Miller Homes Holdings Limited
Morris Homes
Nicholas King Homes
Norfolk Homes Ltd
Pat Munro (Alness) Ltd
Persimmon Homes Limited
Prospect (GB) Ltd
Redrow Homes Limited
St Modwen Homes Ltd
Stonebond Group Ltd
Stonebridge Homes
Taylor Wimpey UK Limited
Thakeham Homes Limited
Vistry Homes Limited
Wheeldon Brothers Limited