It is the first estate agent in the country to offer Deposit Assist – which provides loans to parents who can then gift them to a child for use as a deposit on a house.
The loan can be for up to 15 per cent of the purchase price of the first-time buyer’s property which means they can obtain an 85 per cent mortgage.
The deal is an extension of Blundell’s Assist, which was launched by former Dragons’ Den star James Caan in 2010 and which offers interest-free loans to help buyers and sellers cover unavoidable costs such as estate agent fees, stamp duty and legal fees.
Steve Hinshelwood, managing director of Blundells, which was recently acquired by Countrywide and is now part of the country’s biggest estate agency group, said: “Once again Blundells is leading the way with an innovative idea to help stimulate the market and assist people to achieve their objectives.
“In the current economic climate, first time buyers in particular are struggling to come up with the large deposits needed to get them on the property ladder.
“Often they can afford what the mortgage repayments would be but the deposit required is the real stumbling block.
“The options available for these younger people, who may now find themselves stuck living with parents or in the rental market but desperately want to buy a property, are limited so this is where we hope Deposit Assist will come into play.
“The scheme is effectively a 100 per cent funding option if an 85 per cent mortgage is combined with a 15 per cent parental unsecured deposit loan.”
Through Deposit Assist, parents can apply for a loan from £10,000-£50,000, on a fixed 12-year term loan at a competitive interest rate of 5.4 per cent, and then gift this to their child as their deposit.
The loan is not secured against the parent’s home so there is no necessity to remortgage or ‘cash in’ important investments.
Steve added: “The terms of this deal are really strong which is what makes the product a really viable option. We are initially piloting the scheme at our Crystal Peaks and Gleadless branches and we are confident that interest will be strong.
“Deposit Assist is more likely to be of use to first time buyers but it could also be of interest to those whose situation has changed, for example, they may be in a house with no equity, and may now have children but are trapped and can’t move because they can’t raise a deposit.”
Blundells, which was founded in 1977, has 13 branches under its own brand in North Derbyshire and Sheffield.