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Lloyds TSB lends a hand to first-time sellers

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by Gill Montia

Lloyds TSB has extended a mortgage deal previously only available to first-time buyers, to home movers.

Sellers opting for the bank’s Lend a Hand loans can take out a mortgage with a deposit of just 5%, at a rate normally associated with a larger down-payment.

However, their funds have to be backed up with the savings of helper, such as a parent, grandparent or other family member.

According to the bank, no other major lender offers deals for new customers moving house unless they have a deposit of at least 10%, with the lowest rate currently available 5.99%.

With Lend a Hand Lloyds TSB current account holders qualify for a rate of 4.79% at 95% loan-to-value ratio and with a £895 fee, with the rate rising to 4.99% for non-current account holders.

At the same time, their helper benefits from a competitive savings rate (currently 3.75% AER gross), as a legal charge is taken over the savings to offset the lender’s risk.

Lloyds TSB commercial director, Stephen Noakes, says: “It’s not always easy to pull together a big deposit in today’s market, but this product can make the move to a new home not only more achievable, but more affordable.”

The lender has also announced the launch of a campaign on behalf of first-time sellers and will be taking a look at the challenges they face.

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News posted: July 8, 2010

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