"By extending it further we will be able to help many more service personnel make those first steps on the property ladder or expand their home"
The Forces Help to Buy scheme has lent over £280 million to over 18,000 armed forces applicants since its introduction in 2014.
The scheme allows military personnel to borrow a deposit of up to half of their annual salary, interest free, to contribute towards buying a home, building an extension on their current one or moving to another property.
Defence Secretary, Ben Wallace, said: "The extension of this scheme demonstrates the value we put on our Armed Forces and means service personnel can continue to realise the ambition of owning their own home or borrowing to extend.
"It has already proven very popular amongst the Armed Forces community and by extending it further we will be able to help many more service personnel make those first steps on the property ladder or expand their home to fit their family."
In last October's Budget, the government announced that it will extend the standard Help to Buy scheme until 2023.
The Budget announced that from April 2021, a new Help to Buy Equity Loan scheme will run for two years before closing in March 2023.