THE FAMILY MORTGAGE – AN INNOVATIVE MORTGAGE THAT HELPS FIRST TIME BUYERS ON TO THE PROPERTY LADDER
If you have a client who has saved a 5% deposit, or they have a family member who’s willing to provide this as a gift, our award-winning Family Mortgage may be just what they need to get their foot on the property ladder.
As most first time buyers only have a small deposit to put towards a home, they miss out on most of the better mortgage rates. At the same time, families may have savings and property that could be used as security for a buyer. Our innovative Family Mortgage brings these wider family assets into the mortgage calculation, helping to reduce the cost for the buyer but not asking family members to hand the money over as a gift or remortgage.
How it works
Family members who wish to help their adult children buy their first home can help using just one or all three of these options:
1. Using family savings as security – family members savings can be placed in our Family Security Account. As well as paying interest it counts towards the amount used for the security without actually having to ‘gift’ the money. The savings are still owned by the family members.
2. Using family property as security – aimed at families who do not have the money to spare, a family member can offer some of their own property’s value as security for the new property.
3. Offsetting against the mortgage – family members have the option of depositing savings in a Family Offset Account which acts as security for the buyers mortgage and helps to reduce the mortgage monthly payment. The savings are still owned by the family members.
All three options can be used in combination. It’s this flexibility and innovation that’s won us the What Mortgage ‘Best Guarantor/Assisted Mortgage Lender’ award for the third year running.
Each Family Mortgage will be reviewed after each three or five year fixed rate term. After 10 years we review the mortgage, taking into account the changed circumstances of the buyer and the property’s value, which could mean the money being released back to the family members and any charge over a property being removed.
An added benefit – Unemployment Cover
As an additional benefit, subject to certain conditions, we will also meet a buyer’s share of the mortgage payments for up to six months, should they become unemployed through no fault of their own.
For more information about our Family Mortgage please call us on 01372 744155. Alternatively, please email: [email protected] or visit http.//intermediaries.familybuildingsociety.co.uk/family