Your First Home:
look beyond year five.
The government loan has later interest and value-linked repayment. Compare the published stages, then keep the rest of your household budget beside them.
Last updated · England
Start with affordability.If you do not have a price in mind, build your income-first budget. This calculator illustrates a chosen price; it does not approve borrowing or scheme eligibility.
The published costs in a £300,000 example
A 2.5% deposit is £7,500. With the full 20% equity loan (£60,000), the mortgage is £232,500. At an illustrative 5% over 30 years, the mortgage is about £1,248 a month. Loan interest adds £75 in year 6 and £150 from year 7 if the equity loan is unchanged.
The mortgage and loan-interest subtotal is about £1,248, £1,323 and £1,398 respectively. It excludes tax, legal work, surveys, moving, all household bills and a reserve. The interest does not reduce the equity loan. Your mortgage rate can change.
Repayment changes with the home’s value
An original 20% equity loan normally requires repayment of 20% of the home’s later independently assessed value. On the £300,000 example, a later £320,000 valuation would mean £64,000 to repay; a £280,000 valuation would mean £56,000. Paying interest has not paid that loan down.
What this calculation leaves open
No lender, local cap, participating home or personal eligibility is checked. Full guidance is still due on minimum repayments, valuations, extra charges and sale or remortgage processes. Unknown costs are not £0. Read the maintained Your First Home guide and check the official rules before committing to a purchase.
Check my ordinary monthly budget →Ask Rob at Lynton Mortgages about a first-home mortgage →Questions you might be asking
Does this check whether I qualify for Your First Home?
No. It illustrates the published funding split, loan-interest stages and value-linked repayment principle. It does not check your income, credit, local cap, lender, developer or the exact home.
Does paying equity-loan interest reduce the loan?
No. The interest is separate from repayment. Under the published guidance an original 20% loan normally requires repayment of 20% of the home’s later independently assessed value.
Why is my normal saved plan separate?
It starts with your income and spending and models an ordinary purchase. This standalone illustration does not change that plan or assume the government will allocate a loan.
Sources
Original information checked 28 October 2026. Lender criteria and government plans can change.