Lloyds TSB and Powys County Council have joined forces to help first-time buyers purchase a home with a deposit of just 5%. The Local Lend a Hand product will be available in local branches of Lloyds TSB from today (Thursday).
First-time buyers often say that raising a deposit is the biggest challenge they face when looking to take their first steps onto the property ladder but Powys County Council has set aside £1m which should help 30-40 buyers.
Responding to calls for further innovation in the first-time buyer market, Lloyds TSB worked with Sector Treasury Services, part of the Capita Group, to develop the Local Lend a Hand product. The scheme enables borrowers to buy their first home with a deposit less than the 10% required by most mortgage lenders. The fixed rate mortgage products that will be available during this scheme will also be at a lower rate of interest than would normally be available for this level of deposit.
Stephen Noakes, mortgages director at Lloyds TSB, explained: “With the launch of Local Lend a Hand in Powys, we’re making the housing market more accessible to more people. Helping people to buy their first home is crucial in achieving and maintaining a sustainable housing market.”
Councillor Graham Brown, Cabinet Member with responsibility for Affordable Housing, said: “I am very pleased that the Council is able to enter into this partnership with Lloyds TSB to provide assistance to first-time buyers in Powys. The Council has held the provision of more affordable housing as a high priority for some years and this initiative will assist those who need just that little extra support to become home owners.”
Subject to Lloyds TSB's usual lending criteria, borrowers are able to select any existing property in the area covered by Powys County Council up to a maximum loan of £175,000. First-time buyers will put down a minimum 5% of the property price, and Powys Council will provide a cash backed indemnity of up to 20% as additional security. The local authority then earns interest on this amount.
The first-time buyer owns the property in its entirety, and will have access to a range of products at a lower rate of interest than would normally be available for this level of deposit.
Those interested in the local scheme should visit their local branch of Lloyds TSB for more information.
PICTURE: (from left) Cllr Graham Brown, Cabinet Member for Affordable Housing, Stella Clayton, Lloyds TSB Welshpool Bank Manager, Terry Flynn, Affordable Housing Officer, Powys County Council, Howard Mansell, Local Mortgage Manager.
