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Calls to support first-time buyers

More support should be offered to first-time buyers hunting for a mortgage deal, the CBI has said.

Noting the mammoth task of saving up for a large deposit, the business group called for the introduction of mortgage indemnity guarantees (MIGs). These would protect a lender if the house buyer fell badly behind with payments and the property needed to be repossessed or sold.

The CBI suggested lenders and house builders in the private sector should team up to deliver MIGs. The Government too could take on some of the risk, it said.

Through the scheme, the lender would enjoy the peace of mind that if the house was sold for less than the outstanding mortgage total, they could claim on the mortgage indemnity to recover its loss.

In its Unfreezing the Housing Market report, the business group made a rallying call to help first-time buyers, which it said provided the "lifeblood" of the housing market.

Copyright © Press Association 2011

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