Barclays mortgage deal offering zero deposit but few will be eligible | Personal Finance | Finance

Barclays is offering a new zero deposit deal on their mortgages for borrowers who meet a set of specific criteria in an “effort to make home ownership more accessible”. The money-saving offer will be available to people buying their home under the Right to Buy scheme. The high street bank will be using the discount people get through the scheme in place of the deposit.

For example, if you’re eligible for a 40% discount through the Right to Buy scheme, Barclays will view this as you putting down a 40% deposit. So, your mortgage will be covering the remaining 60%.

Alongside this, Barclays is also offering reduced rates for people with lower Loan-to-Value mortgages. To be eligible for the zero deposit deal, you must be buying your home through the Right to Buy scheme, which is only available to council tenants looking to buy their council homes.

Other eligibility criteria can be found on the Gov.uk website, including technicalities around making a joint application and other rules for Wales, Scotland and Northern Ireland.

According to the latest figures just over 1.6 million households in England rent from local authorities and around 11% are believed to be eligible for the Right to Buy scheme.

In the 2022/2023 tax year, 14,085 houses were sold through the scheme and Barclays new offering could see Right to Buy becoming more affordable during the cost of living crisis.

High-value properties will be excluded from Barclays’ deal and lending is capped at 90% of the full market value.

Lee Chiswell, Head of Mortgages at Barclays, said: “The Right to Buy scheme has long been a crucial route to home ownership for council and housing association tenants, yet we know that saving for a deposit remains a key obstacle.

“By lending for the full value of the property, we’re removing the need for buyers to have any deposit at all, helping many completely sidestep their largest barrier to home ownership.”