But the newspapers said they’re back
It is true that with certain types of mortgage you can borrow 100% of the property value.
However, there are some significant conditions attached and they’re conditions that affect your loved ones as well as yourself.
100% mortgages available today are what are known as Guarantor Mortgages or Family Deposit Mortgages.
With Guarantor mortgages, a family member must agree to guarantee your mortgage repayments. If you can't meet your repayments and your home gets repossessed, your mortgage lender will expect your guarantor to cover the cost of any losses or even repossess the family member’s home to cover them.
With Family Deposit Mortgages your family member must deposit cash, usually between 10% and 20% of the property's value in a special savings account.
This money is held for a fixed period of time as security against your mortgage. When you’ve met the repayments and any other conditions for a period of time, the money is returned and if you can’t, this money is used to meet repayments.
In truth these products have existed for a while. They have come to the media’s attention recently because a mainstream lender announced a new family deposit mortgage at a lower fixed rate than other products of this type on the market.