Posted on 23 March 2011
Councils set to give help to first-time buyers
Posted in Legal news
A new scheme has been launched which aims to give potential first-time buyers help to get a foot onto the property ladder.
The scheme, called Local Lend a Hand, has been developed by Sector Treasury Services, and is already backed by Lloyds TSB. It will see local councils provide security worth 20% of a property’s value which will enable the buyer to qualify for a lower mortgage rate. Five local authorities are currently trialling the project but there are plans to roll it out to other parts of the country later this year.
The money put into a property by the council in question would be held with the lender and interest on it would be payable, but it will enable first-time buyers to potentially buy a property with a deposit of as little as 5% of the value.
Stephen Noakes, commercial director of mortgages at Lloyds TSB, said: “We know that a lot of young people turn to the “bank of Mum and Dad” to get their foot on the ladder, but that’s not a solution to everyone. By developing Local Lend a Hand and working with local authorities across the UK, we’re broadening the prospect of home ownership to even more first-time buyers.”