The Bank Of Mum And Dad


THEY ARE THE UK’S 10TH BIGGEST LENDER

 
 
 
 
HOW MUCH COULD I BORROW?

THE BANK OF MUM AND DAD

Getting on the property ladder is tough. That’s why many parents are helping their children by contributing to their deposit or acting as a guarantor for their mortgage. In fact, it was said that in 2019 the Bank of Mum and Dad was the 10th biggest lender in the UK, paying out £6.3 billion!

Gifting a deposit

Gifting a deposit is one of the most common ways parents help their child buy a home. With that though come a set of rules that you will need to adhere to:

  1. The mortgage lender will require proof that the money came from parent (or grandparent or generous friend!) and should be evidenced by way of a letter confirming such – don’t worry, we can assist with templates for this.
  2. The lender will request the last three months bank statements for the account that the gift came from – as evidence for their money-laundering checks.
  3. Whoever is gifting the money will need to confirm that it won’t need to be paid back, as the lender will want confirmation of such in writing.
  4. The person gifting the money will be required to sign a declaration that they have no legal interest in the property being purchased.

Other options

Many parents don’t have enough savings to gift the money for a deposit. Where this is the case there are several options that can be considered, including:

  • Guarantor mortgages
  • Joint mortgages
  • Remortgaging
  • Joint Borrower Sole Proprietor (JBSP) mortgages

Finally, anyone gifting money should always seek financial advice on the implications of doing so, especially from a tax and/or inheritance tax perspective.

 
Not quite ready to start the mortgage process just yet? Maybe you have a question you want answering? That’s fine, we’re here to support you when you need us – just contact us and we’ll be happy to help.
BOOK A FREE NO OBLIGATION MORTGAGE APPOINTMENT

WE PLAY BY THE BOOK

You may have to pay an early repayment charge to your existing lender if you remortgage.
Your home may be repossessed if you do not keep up repayments on your mortgage.
There may be a fee for mortgage advice. The fee is up to 1% but a typical fee is £650.

Privacy Settings
We use cookies to enhance your experience while using our website. If you are using our Services via a browser you can restrict, block or remove cookies through your web browser settings. We also use content and scripts from third parties that may use tracking technologies. You can selectively provide your consent below to allow such third party embeds. For complete information about the cookies we use, data we collect and how we process them, please check our [privacy-policy-2]
Youtube
Consent to display content from Youtube
Vimeo
Consent to display content from Vimeo
Google Maps
Consent to display content from Google
+
Loading...