Mortgage for Children
Mortgage for Children - are simply mortgages aimed at parents who are looking to help their children onto the property ladder.
Capital Fortune can arrange family mortgages to assist both the parent and the child. Mortgages for children can allow the parent to help with obtaining the mortgage loan by utilising their parental income to purchase the property jointly or simply use their own income to guarantee the mortgage loan.
In order to undertake a parental mortgage the parent will require sufficient monthly income to satisfy the mortgage lender that coupled with the child’s income, the mortgage is both suitable and affordable. The lender will look at the total income to ensure the mortgage is then affordable. In some circumstances, when the child is at University or has limited income, Capital Fortune can still arrange the loan to include both applicants. If the child is under 16, we may advise on a Trust mortgage with a minor child listed as the stated beneficiary.
The parental income will however, need to be sufficient to cover any new mortgage loan.
Mortgages for children – Guarantor mortgages
A number of lenders will offer a guarantor mortgage allowing the parent to guarantee any shortfall in the child’s mortgage payments. In the UK, mortgages for children, parent and guarantor mortgages are becoming more common as the prices of property have risen and the rate of wage inflation has not followed suit. In contrast, in Japan for example, mortgages for children are the norm, with often three generations of families, including children, parents and grandparents all being party to the family mortgage.
Children mortgages can provide much needed help to first time buyers and those on a modest income as if the combined income is sufficient, it will enable a mortgage borrower to take out a mortgage they would not be able to do otherwise.
In utilising the good will of a parent, the parent will need to be clear that whilst the child may be the home owner, both applicants are jointly and severally liable for the whole of the mortgage debt and this is a big commitment for someone entering into this form of arrangement.
Parent Mortgages – Capital Fortune Service
All of our Mortgages for children can be dealt with over the telephone or in certain circumstances we may be able to visit at home or work. We will strive to take the difficulty and time element out of the mortgage application.
We will obtain all the necessary documentation from you after our first discussion and will avoid cascading you with a range of further information during the internet mortgage application. We will contact you via email, text message or mobile telephone at convenient times agreed by you.
Once the children mortgage application has completed, the mortgage and mortgage protection needs of both the parent and child will be constantly reviewed and in the event that new products become available, we will look to continually switch you to those products in order to increase the savings in a hassle free manner.
For more information on our mortgages for children, call us today on 020 77 100 400 or Enquire Online.