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Thursday, 5th May 2016

Categories: Sales

Author: Tony Ryan

Barclays have caused quite a stir recently, being the first major bank to bring back 100% mortgages since the 2008 financial crisis. A move they say is designed to give hope to those first time buyers who fear the dream of owning their own homes is one that may never come true, but one that has been ‘slammed’ by housing analysts who fear the new proposals are too risky. There are strings, or should I say parents, attached to these new loans though. While the headlines say the mortgage requires no deposit, the ‘bank of mum and dad’ (or other generous relatives) would be required to open a Barclays account linked to the mortgage and deposit savings equivalent to 10% of the final price of the property. Then in three years the money is returned to the helper, with a small interest. Statistics show parents help finance 25% of all mortgage payments nationally, so will this move be one that gets families rushing to their nearest Barclays? Whether you agree or not with these new mortgage offers, it will be very interesting to see how the market reacts and which, if any, other banks follow suit with similar products.