22 June 2018
There could now be a new opportunity for people to get on to the property ladder. We all know how difficult it can be to save enough money for the deposit, especially if you have to pay a contribution to family expenses when living at home or if you rent.
Renting a property can be an attractive option. It can provide an independence lifestyle without the concerns of having to replace or repair fixtures within the property as these often remain the landlord’s responsibility. However, rent paid is not recoverable and therefore could be viewed as unrewarding. Paying a mortgage at a similar rate to rent has the benefit of eventually owning your own home. The difficulty is getting onto the property ladder in the first place, when you have no deposit available.
There may now be an opportunity to do just that. Prior to the 2008 recession, most lenders provided mortgages to individuals without the need for a deposit. On occasion they would lend in excess of what the property was worth. Some financial experts believe this is what led to the financial meltdown and consequently these types of mortgages were removed from the market. It appears that a few of the market lenders are once again offering a similar type of mortgage.
Barclays Bank is the first well-known lender to once again offer a mortgage without the need for a deposit. Barclay’s require a “temporary deposit” to be paid by a third party. If someone is willing to provide 10% of the mortgage, for a period of three years Barclays offer the opportunity for you to purchase your own home.
Barclays Bank, place the temporary 10% in a special savings account. They will hold this money for three years. This is security in the event you are unable to keep up with the mortgage repayments during this period.
However after the three year period has passed, the temporary deposit can be withdrawn and returned to the provider of the security money.
As with most things there are risks, so ensure you seek professional legal advice from one of our Conveyancing solicitors at Williamsons by contacting us on 01482 323697 or visiting our website via the link www.williamsons-solicitors.co.uk
