It has been reported this week that Aldermore Bank has launched a 100% mortgage deal which will allow homebuyers to borrow the full amount of a property’s value, without putting down a cash deposit.

The small bank, which was launched in 2009, is the first lender to offer a new mortgage at 100 per cent since the widespread withdrawal of these high loan-to-value (LTV) deals during the financial crisis. But to obtain the loan, potential homebuyers will need to secure a guarantor, such as a parent, grandparent or guardian, who is willing to support it.

This needs 25% of the mortgage to be secured through a charge on the guarantor's own property.

Although the guarantor would not need to provide any money upfront, if the borrower’s property was repossessed they would be liable for any shortfall that the sale brings. This means that the guarantor would need to be confident that the borrower they are helping out is in a sound state of financial play.

High LTV mortgages were a common sight pre-financial crisis, but lenders stopped offering them when house prices crashed in 2009. At present, most big High Street lenders usually require at least a 10% deposit, although some are offering lower deposit deals. Lloyds Banking Group for example has some mortgage deals which start at 5%.

One of the most prolific providers of high LTV mortgages during the property boom, bailed-out bank Northern Rock, recently launched a range of loans with a 10 per cent deposit aimed at first-time buyers.

Read more about this at: http://www.thisismoney.co.uk/money/mortgageshome/article-2033878/Aldermore-launches-100-deposit-guarantor-mortgage.html#ixzz1XfION0mp