Like a Deposit Boost, your loved one will contribute to your house deposit, or supply the cash for the entire down payment. However instead of this being a gift, their contribution will be in return for equity in your home.
This family deposit mortgage option can either be as an equity loan, where they will own a percentage of your property, or as an interest-free loan that is repaid when the property is sold.
This will make you co-owners, but you will each own an individual share of the property. The value of your share will reflect what you contributed to the deposit and monthly repayments, as well as any change in the property value.
Not every mortgage is for everyone. Here’s some things you should know before applying.
Get a home of your own sooner
On average, it takes 8 years to save up for a house fund. With a loved one contributing to the deposit, you can get on the property ladder quicker.
Increase what you can borrow for a mortgage
With a larger house deposit, you can get access to better mortgage rates or afford a more expensive property.
You can buy out your relatives later down the line
If you are able to afford the mortgage by yourself later on and can buy out your loved one’s share, through a transfer of equity you can become the sole owner of the property.
Keep your independence
If you require support to buy your home, but don’t want to be gifted a cash sum, this enables you to offer your supporter a potential upside.
Your loved one’s funds must be UK based
While deposit loans can come from non-UK residents, the funds from your relative must come from a UK-based bank account and be in the UK for 3 months prior to funds being released.
Your lender options will be limited
In choosing to use a Deposit Loan, you won’t be able to access a wide range of lenders and mortgage products. This might mean you don’t get the best available rate on your mortgage.
Your loved one will need to provide evidence
They’ll need to provide evidence of their identity, proof of address, NI number and source of deposit.
Get into your very own home in 4 simple steps
In under 10-minutes, we’ll check your eligibility for a Deposit Loan, as well as our other family deposit mortgage schemes. Plus, you’ll get a personalised recommendation including interest rates and repayments.
Book a call with our mortgage experts to complete the qualification process, and we’ll cover off any questions you might have about Deposit Loan and any other family deposit mortgage schemes.
Once you’ve found a property, your dedicated advisor will undertake full affordability and submit a Decision in Principle. Once accepted, we’ll submit a full mortgage application for you.
During the conveyancing process, we’ll liaise with the developer or seller and your solicitors to ensure a smooth purchase. We’ll also provide a free insurance protection review, so you’re covered if the unexpected happens.
Explore our other buying schemes to discover alternative ways to buy.
On your own
Purchase a new build home from a participating home builder with just a 5% deposit.See details
With a guarantor
Buy with loved ones as co-owners. They’ll contribute to the repayments, in return for equity in the home.See details
part buy part rent
Buy a share of a home, then pay rent on the rest. Over time, buy more of the home till you have full ownershipSee details
Confused about mortgages? Read our guides for expert tips on saving, buying and the market.
You can be snug in your very own home in 4 simple steps