The new 130 per cent mortgage released by Mortgage Express, the specialist lending arm of Bradford & Bingley, could be investigated by MPs.
The Times has reported that Labour MP Nigel Beard, a member of the Treasury Select Committee, has said this sort of loan should face an inquiry.
Mr Beard said: "I would like to see the committee investigate such high-value loans before they become a trend."
Bradford & Bingley said the loan was created to let first-time buyers and existing owners consolidate their credit card and other personal debts, and that it had proved successful during a two-year trial in Northern Ireland.
"We ran an expensive two-year pilot on this product and found that there was a market for it. We always act as a responsible lender," Bradford & Bingley said.To get mortgage advice from the Fair Investment Company, click here.
© DeHavilland Information Services plc