Lloyds bank is bringing back its 10% mortgages for first time buyers - but tougher new rules mean only a few people will qualify.

The lender said new-build properties will be excluded under new terms, while buyers will have to carry out enhanced credit checks to apply.

It said the deals also won't be valid alongside other "lend a hand" schemes such as Help to Buy which are hugely popular amongst first time buyers.

The products, going on sale from December 8, will be available from the group's Lloyds Bank and Halifax brands directly and via Halifax intermediaries.

The maximum loan amount will be £500,000 and the maximum loan-to-income ratio will be capped at a multiple of 4.49.

Halifax - which is owned by Lloyds - will also offer the 10% deal

In line with many other lenders, Lloyds pulled its 10% deposit deals around the start of the coronavirus crisis.

It has since been offering 15% deposit deals.

Lenders have become concerned about "riskier" low deposit loans amid the potential for house prices to fall and some borrowers to be left in negative equity - when they owe more than the value of their home.

Uncertainties over many jobs in the economic crisis also heighten the risks generally of some borrowers defaulting on their loans.

Lloyds' new 10% deals will not be available to existing homeowners, unless another applicant in a joint mortgage application is a first-time buyer.

The 10% deals aren't applicable on new builds

Jasjyot Singh, managing director, consumer and business ban

king, Lloyds Banking Group said: "We are committed to helping people take their first step on to the property ladder and while there have been record levels of mortgage approvals over the past few months, raising a deposit is still hands down the biggest challenge for first-time buyers.

"Reintroducing options at higher LTVs (loans-to-value) means we can support more people ready to get a foot on the ladder.

"We will monitor service levels to make sure we continue to be there for our customers.

"We also relaunched our Lloyds Bank Lend a Hand mortgage last month, which enables first-time buyers to borrow up to 100% of the mortgage with the support of their family."

Several other well-known lenders announced plans last week to re-enter the 10% deposit market, offering new products or expanding access to low-deposit deals.

People look at properties advertised in an estate agent's window
It also can't be used alongside the Help to Buy Equity Loan

Nationwide Building Society has previously announced plans to increase access on higher loan-to-value mortgage lending.

It said that from the second week of December, it will be expanding its lending by making 10% deposit loans available for house purchase and for existing mortgage members looking to move home, giving them the same access to 90% LTV (loan-to-value) loans as first-time buyers.

Yorkshire Building Society has started offering 10% deposit mortgages once more after withdrawing lending at this level in the summer.

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Its new deals are aimed at first-time buyers and existing homeowners who want to move or remortgage.

Yorkshire's intermediary arm, Accord Mortgages, also offers 10% deposit mortgages.

TSB has also enhanced its first-time buyer deposit range.

According to National Association of Estate Agents (NAEA) Propertymark, just over a fifth (21%) of house sales were made to first-time buyers in October, up from 19% in September, but a six percentage point fall compared with October 2019.