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Parents increasingly guarantee mortgages
Date: Sat, 22 Oct 2005
The number of parents acting as guarantor for their children's mortgages is increasing as the property market remains competitive.
The rising cost of first-time homes means that many people are becoming reliant on financial help from relatives and this in turn has boosted the parents guarantee mortgages market.
However, the Yorkshire Building Society has launched a new account that will allow parents to save for their child's financial future without having to use their own savings.
The new Offset Plus account means that parents agree to "give-up" interest on their savings account and instead put it towards their children's monthly mortgage payments.
"Offset Plus has been designed with first time buyers in mind," said a spokeswoman for Yorkshire Building Society.
"It allows parents, who cannot afford to give a sizeable amount of money to their children, an option where they can provide financial support to their children," she added.
The product also has the added benefit of not attracting tax, as the savings do not earn interest and are therefore exempt.
Parents Guarantee Mortgages from Endsleigh Financial
If you are currently interested in arranging a parents guarantee mortgage or simply want to discuss your situation further please click here and fill in our short mortgage quote form.
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