Britain launches home loan guarantee plan as property prices climb
LONDON (REUTERS) - Britain launched a flagship scheme on Tuesday to help people get on the property ladder, defying critics who believe the state-backed mortgage programme could fuel another housing bubble.
"Help to Buy" was launched hours after a survey suggested British house prices were rising at their fastest pace in 11 years.
RBS and Lloyds, two banks in which the government retains big stakes after bailing them out during the financial crisis, will start marketing state-backed mortgages this week. HSBC, Europe's biggest bank, announced it would join the scheme later this year.
Smaller lenders Virgin Money and Aldermore have also agreed to participate. But Barclays and the British unit of Spain's Santander were still considering whether to join the programme which allows homebuyers to put down a deposit of as little as 5 percent.