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Keeping it in the family

Amanda Jarvis

February 13, 2002

The mortgage allows a parent or close relative to act as guarantor for any shortfall between the amount a borrower might normally be offered and the cost of the home they wish to buy.

The guarantor can then be released from the scheme at any time during the loan period as their pay increases and they are in a position to cover the full amount.

The loan is available for up to 100 per cent of the value of the house, and has a five-year fixed rate of 5.99 per cent.

Robert Hollinshead, chief executive of Newcastle Building Society, said: “Getting onto the first rung of the property ladder is very difficult, not only in the South East, as you would expect, but also in regions such as North Yorkshire and Warwickshire. With the Guarantor Mortgage we give families of young professionals the chance to give them a helping hand by guaranteeing the excess loan amount.
“The majority of young professionals achieve significant salary increases in the first five years of their careers, so in many cases the Guarantor will not be needed beyond the first few years.”


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