The dream of owning a home could soon become a reality for more people in Bolton, an estate agent has said after it emerged a lender is expected to offer 100 percent mortgages for the first time in years.
Skipton Building Society is planning to launch a loan for first time buyers who do not have a deposit in a move that could start a trend in the mortgage sector.
This means more people can get a foot on the housing ladder.
Andrew Cardwell, from Cardwells Estate Agents in Bolton, called the move "positive" but said there were also risks including a robust criteria for which potential homeowners should seek advice.
He said: “This is really positive news for first time buyers who have been renting for a while and have been eager to get a foot on the property ladder.
“This may well help to make the dream of owning a home become a reality for some people, especially those who thought it was unattainable whilst paying rent each month.
“Although there are notable risks associated with a 100 per cent mortgage such as possible negative equity, the criteria for lending will likely be robust and I would hope that lenders will of learned lessons from the 2008 financial crises.
“Anyone considering this type of property purchase mortgage should seek professional financial advice and Cardwells Estate Agents Bolton would be pleased to introduce you to experts who can assist.”
Although the precise details of the loan have not yet been released, the deal is expected to be fixed for two years, and borrowers will be required to demonstrate a history of paying rent at a similar level to a mortgage repayment for up to two years.
Stuart Haire, chief executive of Skipton Building Society, said he wanted to “help those trapped in rents”.
Prior to the 2008 financial crisis, all large lenders including Lloyds and HSBC offered no-deposit mortgages.
These loans were banished from the market following the crisis amid a crackdown on risky lending.
But the lack of affordable mortgage options for first-time buyers has increased their appeal amid concern in the government that its plans to increase homeownership are at risk.
The Bolton branch of the Skipton Building Society is located on Deansgate.
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