First-time buyers in the UK can now get the mortgage offered by Halifax with the help of friend or family to get on the property ladder
First time buyers looking to get on the property ladder can now get the mortgage offered by Halifax with the help of a helpful friend or family.
Those first-time buyers who have not saved a deposit could get on the property ladder with Halifax’s new ‘family boost mortgage’.
Borrowers can use the mortgage to pay for between 90% and 100% of their property, meaning they do not necessarily need to get a deposit together.
But, customers will need to have a family member who has enough savings to lend them 10% of the property price – although the family member will get their money back, as long as the borrower keeps paying the mortgage.
Instead of a lump sum, savings from parents or other family members can be used to provide security for 10% of the loan.
The money – equal to 10% of the property purchase price – has to be deposited into a three-year Family Boost Fixed Savings Account.
The money in the savings account acts as security for the mortgage.
The lender said that as part of their commitment to lending £30bn to first-time buyers by 2020, they are offering families a way to help give the next generation the boost that they need to get on to the property ladder, while providing competitive rates to both buyer and supporter.
The family member who lends the money to the first time buyer will get their money back, plus interest, after three years, as long as the borrower keeps up with mortgage repayments.
The borrower, or a family member, must have a Halifax Reward or Ultimate Reward Current Account before applying for a Family Boost Mortgage.
A monthly fee applies to the Ultimate Reward Current Account.
Up to £500,000 can be borrowed. Only those who are first time buyers looking for property in England or Wales can apply.