Chancellor Rishi Sunak has confirmed his intention to budget another 95% government-backed mortgage guarantee program for purchase assistance, open to all buyers.

The will be open to home buyers with a five percent down payment, not just first-time buyers, for properties up to £ 600,000. It was largely modeled on the previous purchase assistance program launched in 2013 to help lenders re-enter the market, and is open to used properties and not just new construction.

Sunak has confirmed that the UK’s biggest banks are ready to lend under the scheme from mid-April, including Lloyds, NatWest, Santander, Barclays and HSBC, with Virgin Money set to launch in May.

All mortgages will need to be repaid, not just interest on a loan valued between 91 and 95 percent and is subject to the usual affordability rules. All participating lenders will also be required to offer a five-year fixed rate product as part of its secured mortgage line.

He said: “To quote the Prime Minister, we will turn generation rent into generation purchase. “

Michelle Andrews, Head of Home Buyers at HSBC, said: “We are delighted to once again support the government’s Home Buyers program. At HSBC UK, we are committed to helping people access or rise through the ownership ladder. This program will make a real difference by allowing a greater number of first-time buyers and movers, with a minimum deposit of 5%, to obtain the keys to their new home, and we are delighted to play our part.

A spokesperson for Santander said it did not yet have details on the product, but would be available through intermediaries, branches and by phone.

Mortgage broker, Hiten Ganatra, of Visionary Finance, said: “The mortgage guarantee program will help open up options in the used real estate market and it is amazing that so many lenders are already on board and will deploy products by April.

He added: “The key to the success of the guarantee scheme will be determined by the competitiveness of the mortgage rates offered to those who wish to use it. “

The publicly traded mortgage brokerage firm, Mortgage Advice Bureau, already lists the product on its website.

The program will be open to new mortgage applications from April 2021 to December 2022, reflecting the government’s view that the scarcity of high-value loans is primarily a response to the pandemic rather than a more structural problem.

The government will review the continued need for the program towards the planned end date and has capped the bill for the program at £ 3.9 billion.

Fears remain that the already hot real estate market with rising house prices driven by the Stamp Duty Property Tax (SDLT) holiday, which was extended today, could be even higher after the move.

Victoria is the senior editor of the Mortgage Solutions and Your Mortgage group at AE3 Media. Previous titles include editor of What Mortgage and Credit Today and freelance work for various titles including The Guardian, Which? and Money.co.uk