That is the question…there are several options available if this is a step you are considering or may consider in the future.

In the current economic climate many mortgage deals are only available to those with a 25% deposit.  If your child has not accumulated savings or does not earn enough you may be able to stand as guarantor.  Most guarantor mortgages demand that guarantors have sufficient income to cover the whole mortgage.  After signing the guarantor is legally bound and, unless the lender agrees to release them, they can be made to ay out at any time during the mortgage term.  However as your child's circumstances change and they earn more the mortgage can be changed to one solely in their name.  The initial guarantee being the step on the property ladder they need in the first instance.   Many parents see the loan of the deposit as an outright gift and are happy with a verbal agreement.  However if you are looking to get the money back at some point in the future or when the property is sold a legal and formal agreement is advised and Blair Cadell can help with this.  It is also important to consider if your child is buying with a partner what you need to do to prevent the partner ending up with your money in the event of a slip - again we can help.

If the purchase is to be a part investment for you and you hope to seek some profit when the property is sold speak to Sean MacMillan (sean.macmillan@blaircadell.com). Equity release may be a further option to consider to assist your child in raising a deposit.   A few seeds planted at a time when the variety of property is great and prices are more accessible than they have been for years.

 

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