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25th June 2019
Barclays Mortgages improves first-time buyer product
Barclays Mortgages has made another improvement to its Family Springboard Mortgage, with 2019 marking six years since its initial launch. Having been first introduced in 2013, Barclays Mortgages has opened up the door to more first-time buyers and home movers than ever before by removing the need for them to put down a deposit when purchasing a home.
The new changes to the product extend the fixed-rate period from three years to five, with the term extending from 25 to 35 years. This means that in addition to first-time buyers no longer needing to provide a deposit themselves – only a 10 per cent contribution from a relative or guardian – they will now also be able to borrow a larger sum due to the extended term.
Hannah Bernard, Head of Barclays Mortgages, said: “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. 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.”
Instead of gifting the deposit, the family helper opens a Helpful Start account linked to the mortgage into which they deposit savings equal to 10 per cent of the final price of the house. After five years the money in the account is returned to the family helper with interest. The interest rate on the Helpful Start account tracks a margin of 1.50 per cent above the Bank of England Base Rate.