It has been there for many first-time buyers over the years – a life-changing option that can only come from big-hearted and understanding parents - but never has it been so utilised than in today’s world. The pandemic and high cost of living has resulted in fewer products on the market, and the products available have tougher criteria as high street lenders desire for higher loan to values has dramatically fallen. This means the greater the deposit your clients’ children have the easier it will be to get a mortgage. This is why there has been a greater need for help from parents when it comes to first time buyers trying to get on the property ladder. It is not just Mum & Dad who are gifting their children. Since the pandemic, this bank has extended to other members of the family who are helping their grandchildren, nieces and nephews to finally own their own home.
Buying a first home has always been a daunting prospect
There are many difficulties facing first time buyers - whether this is due to a low salary, they don’t have a large enough deposit or they have credit score issues that can be due to a lack of active credit– it can sometimes seem impossible. Many renters have resigned themselves to just that – renting for the rest of their lives. They just can’t imagine being able to have enough money to own their own property and are just accepting that fate, effectively paying someone else’s mortgage through rent which is often more expensive than the equivalent mortgage payment would be.
What if parents don’t have the funds to gift or even lend to family members?
They might have a strong desire to help their family but simply don’t have enough money themselves. This is where a Second Charge mortgage from Aria Finance can be the perfect solution as long as they own their own home. Many parents will not want to remortgage their home due to early redemption fees. They may also find it hard with the current economic conditions to get a loan from a high street institution. Their age might also be a problem as much of the high street mortgage facilities no longer extend into retirement age, restricting the available lending term and often making the situation unaffordable for lending. Second Charges can be a great way to help your clients’ family get their dream home, releasing dormant equity in your clients’ homes to give their children or relatives a start on the housing ladder. Second charge mortgages can be obtained fast and are a cost-effective way to borrow against the value of your client’s home with the flexibility to help where traditional lenders may fall down.