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Councils to help first-time buyers on to housing ladder Councils to help first-time buyers on to housing ladder
(40 minutes later)
Councils are to help first-time buyers get on the housing ladder by topping up their deposits.Councils are to help first-time buyers get on the housing ladder by topping up their deposits.
Five councils are pioneering a scheme aimed at buyers who can afford the monthly mortgage repayments but do not have a lump sum saved up.Five councils are pioneering a scheme aimed at buyers who can afford the monthly mortgage repayments but do not have a lump sum saved up.
Many first-time buyers find it difficult to purchase a home because lenders are asking for hefty deposits.Many first-time buyers find it difficult to purchase a home because lenders are asking for hefty deposits.
The councils will put 20% of the price in a Lloyds TSB account, with the lender asking for a 5% deposit.The councils will put 20% of the price in a Lloyds TSB account, with the lender asking for a 5% deposit.
The funds will not go to the buyer and the mortgage rate will be lower.The funds will not go to the buyer and the mortgage rate will be lower.
The councils risk losing money if a buyer defaults, but they get a generous interest rate themselves.The councils risk losing money if a buyer defaults, but they get a generous interest rate themselves.
The scheme could benefit up to 300 first-time buyers in each area, but if other councils join, thousands could potentially benefit.The scheme could benefit up to 300 first-time buyers in each area, but if other councils join, thousands could potentially benefit.
Another 10 councils are waiting to join the scheme.Another 10 councils are waiting to join the scheme.
Sustainable marketSustainable market
The scheme is called Local Lend a Hand.The scheme is called Local Lend a Hand.
"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 for everyone," said Stephen Noakes of Lloyds TSB in a statement."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 for everyone," said Stephen Noakes of Lloyds TSB in a statement.
"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."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.
"Helping people to buy their first home is crucial in achieving and maintaining a sustainable housing market," he added."Helping people to buy their first home is crucial in achieving and maintaining a sustainable housing market," he added.
The councils involved so far are Warrington, Northumberland, East Lothian, Blackpool and Newcastle-under-Lyme.The councils involved so far are Warrington, Northumberland, East Lothian, Blackpool and Newcastle-under-Lyme.


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  • class="dna-comment" id="comment_107312004"> class="comments_user_info secondary_body"> 1. hsfil
No no no! What we need is a correction in the market to allow for long term price sustainability, which the market will resolve in the longer term; through lack of buyer affordability and a restriction in the level of debt a person is able to mount up. How is State sponsorship of an asset bubble going to better the issue of housing affordability long term? Let the prices fall!
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