This week’s episode of the Property Investor’s Podcast Russell and Alasdair discuss the new initiative that is helping first-time buyers invest in homes without a deposit.
Lloyds Bank has announced that they will be introducing a 100% mortgage lending scheme to first time home buyers.
This strategy allows first time buyers the ability to purchase a home without having to put down any deposit. The only stipulation is that a family member will need to stand behind the loan from the bank.
The bank will only grant the loan if the member is able to put a 10% sum aside equaling the value of the property in Lloyd’s savings account. The maximum amount they are allowed to lend off the bank is £500k.
This is a drastic change for many lenders. Prior first time buyers could invest but they needed to put down a deposit worth 5% of the purchase price.
Russell and Alasdair discuses who is and isn’t eligible for this scheme. As Russell is a strong advocate of rent where you live and buy to invest. He could be eligible to buy his first home using this initiative.
Saving for the first deposit can always be tough and currently, the national average for deposit being put down is at £33,000