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When You’ll Need a Lend a Hand Mortgage

Lloyds TSB offers the Lend a Hand mortgage as an alternative to applicants who are generally ineligible for obtaining loans on their own for various reasons. To be eligible for this type of loan, you will need a guarantor, and both of you will have to adhere to the conditions specified below.

  • The applicant needs to put up a 5% cash deposit.
  • The guarantor must have savings equivalent to 20% of the purchase amount of the property.
  • The applicant’s deposit and the guarantor’s savings must then be equal to 25% of the purchase amount of the property.
  • The 25% deposit must then be held in savings, which will still earn interest.

If all conditions are met, the applicant not only gets his or her dream home, but also gets to enjoy lower rates for the mortgage. Another benefit is that this mortgage comes with a fixed fee for 3 years, which means you will be able to budget for your mortgage more easily.

Alternative Guarantor Mortgages

If you feel that the guarantor mortgage from Lloyds TSB is not for you, here are some alternatives you may want to consider.

Parents as Guarantors

At co-operativebank.co.uk, you will only need to put up 15% of the purchase value of your future home. The rest can be loaned as long as your guarantor is your parent or proven to be a close family relative. The guarantor’s finances will of course still undergo checking.

Halifax (halifax.co.uk) also offers something similar to Lend a Hand mortgage, but like Co-Operative Bank, the company only accepts guarantors who have proven close family ties to the applicant.

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