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Parents and kids unite for cheap mortgage

Date: Thu, 16 Jun 2005

One in seven parents with grown-up children have remortgaged or taken out a loan to help their offspring enter the property market, according to a survey for BBC2's Money Programme.

However, it may be more beneficial for parents and children to pool resources to ensure they get the best mortgage deals. Under a new scheme from Mortgages Direct and Bank of Ireland Mortgages (BIM) parents incomes can now be included in the income multiple calculation to discover how much a child could borrow.

The potential buyer will be able to borrow up to four times their highest earning parent's salary, minus the parent's mortgage repayment, plus their own salary.

"Increasingly, parents are having to fund the large deposits required to help their children enter the housing market," said Peter Gladdy, director of Mortgages Direct.

"This is a great product, which provides a realistic alternative and we are delighted that we can offer the exclusive offer which will provide that extra support to help first time buyers onto the property ladder."

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