57% of First Buyers use Bank of Mum and Dad
Latest figures* have shown that more and more people are using the Bank of Mum and Dad to purchase their first home. In fact, an estimated £9.4bn was gifted or loaned meaning around 57% of First Buyers used the bank of Mum and Dad in 2023. Adam Nanson from Your Mortgage Expert comments on why so many people are relying on their parents to buy their first home.
Why do so many people rely on the Bank of Mum and Dad?
“It can be tricky for First Time Buyers to get on the property ladder. According to the ONS, people need a ratio of 8.4 x the average income in order to buy a house in England**.
“Add to this a cost of living crisis, also rising mortgage rates and saving enough money for a deposit. The average deposit paid by a First Time Buyer in the UK is £34,500 and this rises to £144,500 in London***.
“With deposits needed being so high, a gift or a loan from a family member can be a really helpful way of getting on the property ladder. So it isn’t surprising that 57% of First Time Buyers are turning to the Bank of Mum and Dad.”
How can a mortgage broker help?
We have helped lots of people purchase their first homes. If you need help from a parent to get on the property ladder, we understand how the process works and will walk you through everything.
There are several schemes that you can choose from, the two most popular are:
- Gifted deposit – this is where you are gifted the money for your deposit for your home. The amount gifted must be a gift and not a loan.
- JBSP mortgage – A JBSP mortgage is a specialist type of lending to help people get on the property ladder. It enables home buyers to purchase a home with the assistance of a family member. Crucially, while both you and your family member remain responsible for repaying the mortgage loan, you will remain the sole proprietor of the property.
We know how to use these schemes to purchase a home as well as other options such as Shared Ownership and the Mortgage Guarantee Scheme.
If you need any further advice, we would love to chat. Not only do we have access to the current deals on the market, some of which are not available on the high street directly. We also have extensive knowledge of all the current Government schemes designed to give you a helping hand.
By speaking to Your Mortgage Expert, you’ll get access to expert First Time Buyer mortgage advice. We can help you work out how much you can afford to borrow, what your repayments would be and what type of mortgage is most suitable for your personal circumstances. And, if you need it, we can break down all the jargon so you understand whether to opt for a tracker mortgage, fixed rate mortgage or something more flexible.
We aren’t like other brokers. With over 100 five star reviews on Google and over 90 verified reviews on VouchedFor, we would love to work hard for you.
To speak to a member of the mortgage advice team about your mortgage ring Your Mortgage Expert now on 01722 322683. We are based in Salisbury but we can help you no matter where you live in the UK.
***Source : https://www.zoopla.co.uk/discover/property-news/whats-the-average-first-time-buyer-deposit-by-region/