Types of Mortgages Available

Family first Finance offers advice on a range of specialist financial solutions designed to help families help each other to purchase property.

 

Types of specialist mortgages that are available:- 

Guarantor mortgages

 

A guarantor mortgage is commonly used where a third-party guarantees a mortgage for a borrower. This is normally done with the borrower cannot afford the mortgage in their own right or does not have sufficient security to be able to put against the mortgage. Normally the guarantor will have to put a charge against another asset for example their own home and this could be at risk if the borrower fails to keep up repayments on the mortgage. In most cases the guarantor will need to to have sufficient income to be able to afford the whole mortgage in their own right. More...

 

Joint borrower sole proprietor mortgages

 

Sole proprietor mortgages are a relatively new development in the marketplace. With such mortgages a sponsor, typically a parent or grandparent, helps the applicant to purchase a property and becomes a joint borrower on the mortgage. In other words their income is taken into account along with that of the principal borrower. However they do not become an owner of the property and are not registered as a proprietor (or owner) with the land registry. This can have significant implications in terms of the tax liability surrounding a property purchase. With these mortgages a charge is not normally put on the sponsors property. More...

 

Family linked finance

 

Family linked mortgages allow a parent or other other relative to use the equity in their own home to help a child with no or limited  deposit to buy a house. Alternatively the parent may also may be link/offset their savings to a mortgage to act as a deposit or to reduce the interest that needs to be paid on the mortgage. This can be useful where the parent does not want to permanently give the money to the child. In such cases a charge is often placed against the parents property. More...

 

Buy to let mortgages

 

In most cases in order to be able to apply for a buy to let mortgage within the United Kingdom, you need to be a residential home owner. There are however a number of specialist providers that will allow a child's parent to join them on the mortgage. Normally the parent becomes a co-owner of the property. This overcomes the need for the child to be a homeowner already. N.B. Not all Buy to Let Mortgages are regulated by The Financial Conduct Authority. More...

Gifted deposits and family discounted purchases

Most lenders will allow applicants to use a deposit that has been gifted to them. Generally, they or their solicitor will want to see evidence by way of a letter that it is a gift and not a loan and proof that the deposit is in the place is also often required. 

In addition to allowing a gifted deposit, many lenders will also allow a purchaser to buy a property at a reduced price from a family member and if the discount being offered is big enough (e.g. 25%) the lender will often not require the applicant to have a deposit. In this way the family member is gifting equity within a property rather than funds as a full or partial deposit. These types of marrangments are available from a wide range of lenders. Call us for more details on 01173 704231.