Under the offer, first-time buyers will need no deposit if their family back loan by moving 10 percent of the price into one of the bank’s savings accounts.
The mortgage, which is fixed for three years at 2.99 percent and is linked with market-leading 2.5 percent savings rate, will allow a first-time buyer to borrow up to £500,000 for a new home.
The deal is structured so that the relatives backing the deal can help out their children, yet still keep control of their cash savings that they will need later in life.
Research findings provided by Lloyds alongside its announcement showed that the “number one life goal” for people aged 18 to 35 is to buy a house (43 percent), but half say that saving a deposit is the biggest barrier. Meanwhile, more than two in five parents (41 percent) would like to help financially but worry that they’ll need the money later in life.
Half of millennials surveyed (50 percent) said that saving enough for a deposit was the biggest obstacle to buying their first home, while a quarter (26 percent) say they have other priorities at the moment and another 24 percent say they can’t afford to buy in their desired location.
Vim Maru, group director, retail at Lloyds Banking Group, said: "We are committed to lending £30bn to first-time buyers by 2020 as part of our pledge to help people and communities across Britain prosper – and Lend a Hand is one of the ways we will do this.
"At the heart of this market-leading product is helping to address the biggest challenge first-time buyers face getting on to the property ladder, while rewarding loyal customers in a low rate environment."