100% Mortgages

Posted on 27 February 2011 by Laura


I am about to start a job with a £25k salary and I am wanting to buy a property for roughly £100k. I have no deposit but my parents are willing to be guarantors. They have no mortgage on their home, valued around £250k. They are both retired. Is it likely for us to get a guarantor mortgage based on this?

Laura,

There are a number of Lenders offering special schemes for first time buyers and their parents, but none of these offer 100% lending. The minimum deposit you will need is 5% and then depending on the scheme your parent's may also have to put down savings of 20% or accept a charge being secured on their own home.

Guarantors are usually used where the applicant can not afford the mortgage they require, rather than making up for a lack of deposit. In your instance it should be possible to arrange a mortgage based on your salary alone and so it is only the deposit that is of concern. Are your parents willing to raise the deposit on their property and gift it to you?

I believe you would benefit from speaking to one of our independent mortgage advisers. Please call on 0344 346 3672 and tell the consultant the date of your question, they will be able to look at your situation and advise you accordingly.

Peter

Answers provided in response to Ask the experts are based on the information provided and do not constitute advice under the Financial Services & Markets Act. They reflect the personal views of the authors and do not necessarily represent the views, positions, strategies or opinions of John Charcol. All comments are made in good faith, and John Charcol will not accept liability for them.

We recommend you seek professional advice with regard to any of these topics where appropriate.

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