New information has revealed that the Government’s own bank, Northern Rock, is refusing to provide mortgage finance for people purchasing properties under Labour’s flagship first-time buyer scheme.
The bank, which was taken into state ownership by the Government in 2008, does not participate in the HomeBuy Direct scheme, intended to help key workers and first-time buyers onto the property ladder.
Since its launch last September, less than five homes have been bought under the scheme.
Grant Shapps, the Shadow Housing Secretary, described HomeBuy Direct as “a very expensive flop”:
“It’s telling that even the banks in which the Government has significant investments are reluctant to participate in these troubled HomeBuy schemes.”
He stressed, “Instead of a myriad of complex, competing and confusing schemes the Government needs to follow our lead and take simple steps to help first-time buyers like scrapping stamp duty for 90% of them.”