Search
Parents remortgage to provide son with deposit to get onto the property ladder

Parents remortgage to provide son with deposit to get onto the property ladder

28.01.19 | Written by: Erin Gallacher

The clients: Parents looking to help their son and his partner get on the property ladder. One parent is employed as a manager for a cleaning services company and the other is in receipt of disability benefit.

The son also receives disability benefit and his partner is employed full-time as an engineer. Together their income totals £46,550 per year.

Property 1: The parent’s home, a 5-bed detached house which they own outright.

Property 2: The young couple wanted to buy a 3-bed, 2-reception room house with off-street parking just a short walk from the local high street and other amenities.
The finance: The parents were hoping to raise £35,000 against their home to provide a 15% deposit for their son and his partner. Keen for a quick outcome, the four of them approached Mortgages for Business for help.

The application process: To start the process, we needed to deal with the remortgage first. Although the parents were looking to raise a relatively small amount, we needed to select a lender very carefully because they had an element of historic bad credit. So, we approached an intermediary only provider which offers a range of mortgages for applicants with a poor credit profile.

Once this application was underway, we got going on the young couple’s case and approached a lender that will accept both gifted deposits and applicants whose income is derived from state benefit. Unusually, we were able to secure a rate based on five times their joint income, rather than 4.5 times income which is the common multiple for first time buyers.

Both mortgage applications were processed extremely quickly and both couples were delighted to receive formal mortgage offers less than three weeks later.

Property One

Property value: £460,000

Loan amount:
£35,000 (8% LTV)

Rate:
3.84% 2 year fixed

Term:
6 years repayment

Mortgage payment:
£545 pcm

Lender arrangement fee:
FREE

 


Property Two

Property value: £275,000

Loan amount:
£232,750 (85% LTV)

Rent:
1.86% 2 year fixed

Term:
31 years repayment

Mortgage payment:
£826 pcm

Lender arrangement fee:
£995 added to loan


Have a similar case? Contact Erin today for all your residential needs on 01625 416 392 or you can call the mainline on 0345 345 6788.

Request a call back

Start an online chat

Submit an enquiry

ANY PROPERTY USED AS SECURITY, WHICH MAY INCLUDE YOUR HOME, MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON YOUR MORTGAGE.

NB: ANY PROPERTY USED AS SECURITY, WHICH MAY INCLUDE YOUR HOME, MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON YOUR MORTGAGE

Get in contact with us: 0345 345 6788 or ...

Submit an enquiry
Arrange a call back