Lloyds launches version of family mortgage

28th Jan 2019 10:00

(Sharecast News) - Lloyds Bank has unveiled a new mortgage that would allow first-time home buyers to borrow 100% of the property price without having to pay a deposit, but only if they get another family member involved.With the new deal called "Lend A Hand', home-buyers in England and Wales would be able to get a loan-to-value fixed rate at 2.99% for three years only if a family member can save 10% of the loan with the bank.The deal allows 'the bank of mum and dad' to help their children but still maintain their cash savings since the bank will pay an interest rate of 2.5% on the money deposited. Although the family would not be able to access the cash during the first three years.The new mortgage plan is aimed to relieve young buyers from having to save up a deposit that can rise to £110,182 in London but many will not have parents who can support them through this kind of deal.Vim Maru, group director of Lloyds Banking Group said: "We are committed to lending £30bn to first-time buyers by 2020 as part of our pledge to help people and communities across Britain prosper - and 'Lend a Hand' is one of the ways we will do this."At the heart of this market-leading product is helping to address the biggest challenge first-time buyers face getting on to the property ladder, while rewarding loyal customers in a low-rate environment."Barclays currently offers the only other three-year fixed rate available up to 100% LTV, which charges a 3% interest rate for the mortgage and pays the corresponding saver base rate plus 1.5%. There are also 'family mortgages' from Aldermore, Harpenden Building Society and Family Building Society, many of which require family members to put up their own homes as security in place of saving money with the lender.