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New FirstBuy scheme could help 10,000 first time buyers

The Chancellor George Osborne has announced a new scheme which he says will help 10,000 first time buyers enter the property market.

Mr Osborne unveiled the FirstBuy scheme during his Budget speech. It will involve the Government and several major house builders making £250m available to help first time buyers provide a deposit on a home.

The FirstBuy scheme applies only to new build properties. The Government and the house builders will provide loans to fund 20% of the deposit. The buyer will only have to provide 5%.

This will enable them to take out a mortgage for 75% of the property. The loans are free of charge for the first five years and are repaid when the property is resold.

The Housing Minister, Grant Shapps, said first time buyers had experienced great difficulties over the last few years with many having to postpone home ownership until they were well into their thirties. One of the major problems they face is providing a large enough deposit.

He said: "By making up to £250 million available over the next two years for deposits on new build homes, this Budget shows that we are serious about sorting this out, and supporting our construction industry to build more homes, create new jobs and increase the pace of economic growth."

The Government will provide more details about how the scheme will work over the next few months and the first new homes are expected to become available from September onwards.

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