Barclays mortgage deal lets UK first-time buyers to borrow £500k with no deposit
First-time buyers can now avail Barclays’ Family Springboard deals to borrow £500,000 with no deposit as long as a family member or friend contributes to the property purchase price
First-time buyers can borrow £500,000 with no deposit at Barclays as long as a family member or friend contributes 10 per cent of the property purchase price from their own savings.
The banking giant has revealed changes to its Family Springboard mortgage range allowing new homeowners to take out larger mortgages for a longer period of time.
The Family Springboard deals, which were the first of their kind when introduced six years ago, let homebuyers borrow deposit-free by linking their mortgage to a friend or relative’s savings.
The savings are then locked away in a fixed-term savings account for five years as security, while the buyer pays off the mortgage.
The mortgage lets buyers borrow from between £5,000 and £500,000, with a fixed rate of 2.95 percent.
Although it’s called the Family Springboard if one has a very generous friend then they can help you instead.
The bank has adjusted its deals so that homebuyers can take on more borrowing over a longer period of time by extending the term limits to 35 years.
To take advantage of the deal, the family member (or friend) who is willing to help out needs to set up a Helpful Start savings account with Barclays after the bank has made an offer for a mortgage.
After the five-year fixed-term period, they will be given back the 10 percent they handed over, plus interest.
Head of Barclays Mortgages, Hannah Bernard said that since the launch of their Family Springboard Mortgage in 2013, they have been leading the way in offering more people the opportunity to step onto the property ladder earlier than they might have been able to previously.
Bernard said that Barclays own research has shown that many first-time buyers view the money for a deposit as a ‘gift’ that doesn’t need to be paid back, therefore placing a significant levy on the ‘Bank of Mum and Dad’.
She said that the Family Springboard mortgage has been specifically designed to remove the financial burden from parents and to ensure they receive their deposit with interest at the end of the five-year fixed-rate period.