Many first-time buyers rely on the ‘Bank of Mum and Dad’ to help them get on to the property market.
Research suggests the average contribution is now £24,1001 (Source: Legal & General research, 2019). With that in mind, Cooper Associates explore alternative ways to help your child.
This allows you to act as your child’s sponsor. It’s designed to help those who have saved enough of a deposit but are limited on how much they can borrow; therefore, it can include a parent’s income to help them borrow more than on their single income. You and your child are jointly liable for the mortgage.
Family springboard mortgages:
Your child pays a 5% deposit to secure a traditional 95% mortgage. You deposit 10% into an account with their mortgage provider, to cover any monthly payments your child cannot meet. The money will need to be held for five years, earning interest, before you can take it back.
Acting as guarantor:
Some banks allow you to act as guarantor by undertaking cover repayments should your child default, or you can guarantee the extra portion over and above the amount covered by your child’s income. Securing any mortgage is never guaranteed as so many variables come in to play. Take the stress out of helping your child with advice from Cooper Associates Mortgages, who have a wealth of experience in a variety of residential mortgages.
Please call 01291 445 695 or email email@example.com to arrange a free, no obligation meeting.