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The Family Mortgage

The principle behind the Family Mortgage is simple. We know many young people only have a small deposit to put down on a property and they miss out on most of the better mortgage rates.

Raising a deposit is bad enough for a first time buyer, but to get hold of a fair and reasonable rate when your deposit is only 5% can be equally frustrating. At the same time, families may have savings and property that could be used as security for a buyer.

The Family Mortgage brings these wider family assets into the mortgage calculation allowing the buyer to benefit from a fair and reasonable rate that may not be available from other lenders when faced with a 95% LTV.

3 Year Fixed Rate
2.69% TO 30/11/2020
Followed by our managed mortgage rate currently
4.54%
Overall cost for comparison
4.3%APRC
5 Year Fixed Rate
2.89% TO 30/11/2022
Followed by our managed mortgage rate currently
4.54%
Overall cost for comparison
4.0%APRC














Unique Features of the Family Mortgage

1. Security Account

If a buyer can find a 5% deposit, from savings or perhaps a gift, the Family Mortgage allows a family member to provide security for the buyer's mortgage by depositing savings in a Security Account. This money acts as security for the mortgage and reduces the risk, so the Family Building Society can offer a lower rate of interest than might otherwise be the case. This reduces the monthly payments for the buyer while savings continue to earn interest.

2. Security Through Property

Parents and other family members can help first time buyers even if they don't have spare cash. If a buyer has the 5% deposit, a family member can give a charge over some of the value in their property. By providing this security, the buyer could benefit from our 2.69% three year or 2.89% five year fixed mortgage products - a more attractive rate which may not be available elsewhere to buyers with a 95% LTV.

3. Offset Account

This allows family members to use their savings to help the buyer without having to 'give' the money to them. If a buyer has the 5% deposit, additional money from a family member can be placed in an Offset Account with us at the start of the mortgage. In doing this, they reduce the amount of the mortgage on which interest is charged by the amount held in that account. Instead of receiving interest on the savings (which is also subject to tax), the benefit is passed onto the buyer by saving them interest on their mortgage. Money placed in an Offset Account also acts as security for the buyer's mortgage and reduces the risk, so the Family Building Society can offer a lower rate of interest than might otherwise be the case.

4. View All Procuration Fees

Family Mortgage
  Gross fee paid Minimum fee
Adviser 
Network
0.55% £247.50
Mortgage
clubs
0.57% £256.50
Distributors
minimum
0.70% £315.00

The mortgage introductory fee is paid following completion.

For full details on our introductory fees, please click here.

 5. An Added Benefit - Unemployment Cover

As an additional benefit, the Family Building Society will meet a buyer's share of their mortgage repayments for up to six months, should they become unemployed through no fault of their own (subject to certain conditions).

Want to find out more?

Click here to download the Family Mortgage brochure, view our lending criteria here, or click here for a product summary for our Family Mortgage.

If you're ready to submit an application, you will need to complete the below forms:
Family Mortgage application form
Family Mortgage summary application form

Depending on the security being provided you will need to complete one or more of the relevant forms below:
Details of property as security form
Family Security Account application form
Family Offset Account application form

If you have a specific case in mind and would like to discuss the options available to your client, please call us on 01372 744155. We can also arrange for your Business Development Manager to contact you.

Alternatively, you can email us at mortgage.desk@familybsoc.co.uk and one of our team will get back to you.

If you'd like to receive regular updates from us on our products and services including new product launches, please register for our email updates.

Family Mortgage
case-study-fm.jpg

Lee and Nicole started looking to buy their first home whilst Lee was still training to be a teacher. Many mortgage providers didn’t consider the couple eligible because their joint income was too low while Lee was receiving a teacher in training wage.

The couple approached the high street lender Lee has been with since a young boy to get a mortgage directly, but they required a 15% deposit and the repayments were high. After struggling to find a mortgage on their own, Lee and Nicole decided to contact a mortgage broker, who suggested the Family Building Society. The adviser recommended the Family Mortgage as an opportunity for the couple to get on the property ladder.

The Family Mortgage meant Lee and Nicole could put down a low deposit and fix their mortgage at an attractive rate, two aspects that particularly appealed to them. With the help of their parents, they used the security through property option to secure their mortgage.

The couple said the structure of the Family Mortgage was "invaluable", allowing them to combine their deposit with their parent’s assets, to find “the best deal on the market” for them.