My income is insufficient to purchase a home, and I am wondering if I can have my parents help. The fact of the matter is that guarantor mortgages can be a great way for individuals who are short on funds now purchase a property with the assistance of their parents.

The team at Niche Advice can assist you in finding a mortgage lender who can provide the best guarantor loan products available anywhere. If you are interested in climbing the property ladder and stop renting, keep reading.

It is important to note that Niche Advice helps facilitate mortgage lending and does not engage in providing tax advice. Those considering this route are urged to secure their own tax and legal counsel.

How Will A Guarantor Mortgage Function?

Mortgages of this type can have as many as four applicants on a single loan. Borrowers can determine which names will appear on the mortgage deed documentation. It is necessary to be at least 18 years old to secure such a loan. Switching mortgage holder names in the future is simple and straightforward. There are potential tax advantages to be had by folks who get loans of this type, and standard interest rates will apply. Perhaps the best part is that borrowers can secure loans for 90 percent of the home’s value, putting only 10 percent down.

Consider the following hypothetical case. William and Julia are pursuing their education at the local university. William works 15 hours a week in the library, but Julia has no employment at present. Clearly, it would be very difficult for them to succeed in purchasing a property. The parents of these two siblings already own a home and are both still gainfully employed in good positions. In the past, they had contemplated buying a property for their kids to use, but the loan terms were never favorable and they did not wish to be landlords and have their children as tenants.

What did a guarantor loan do to help their situation?

A loan with a guarantor mortgage product permitted this mother and father to become borrowers on the home loan along with their kids. Mom and Dad’s income could be used to secure the loan, though they were not required to be named on the deed documents. After William graduated, he was able to afford the property independently. At that time, he was able to have his parents taken off of the mortgage loan so that he could be the sole owner of the home. It was a perfect solution for everyone.