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EXPERT ADVICE

Need help getting a mortgage?

Here are two options that can help.

Paul Demarco, an Independent Mortgage Advisor at ESPC Mortgages,
outlines how getting support from family might help you get a better
mortgage deal, with two great options to consider.

f you are looking to get on the property Transaction Tax (LBTT) or Additional Dwelling Once the main owner’s income grows, the children or vice versa, which is all dependent
ladder this year or want to support a family Supplement (ADS), although potential capital supporting borrowers can be removed from on income and age range. It is also worth
I member in their home-buying journey, gains tax may be payable. LBTT is tax applied the mortgage, transferring this solely to the noting that lenders will accept gifted deposits
there are some mortgage options which could based on the price of a residential property owner. Buyers should consider whether their for both the Guarantor and Joint Borrower
really help. Rather than providing upfront and ADS is an extra 8% tax you need to pay if parents will be their supporting borrowers for Sole Proprietor mortgages.
cash to assist in the purchase deposit, these you already own a property and buy another. this type of mortgage. A mortgage term is
mortgage options allow for long-term financial calculated based on age of clients. Therefore, if One key benefit of the Guarantor mortgage is
support to aid in the home-buying dream. A Joint Borrower Sole Proprietor mortgage it is parents that are the supporting borrowers, that it allows lenders to consider a guarantor’s
could be described as a type of “income the mortgage term will be shorter, increasing income to help buyers with lower incomes
The first mortgage opportunity is a “Joint booster.” It allows buyers with lower incomes the overall cost of the mortgage payments. borrow more. Younger buyers (e.g. around
Borrower Sole Proprietor” (JBSP) mortgage. to borrow more, with the help of the supporting 30-35 years old) can normally take out their
This lets you purchase a property with the borrowers. It is quite common to see students Some lenders have different restrictions on mortgage term over a longer period often up
financial support from family or friends who looking to buy use this type of mortgage as a way who can be a supporting borrower. However, to 25 to 30 years based on what the buyer is
join the mortgage to boost overall affordability, to increase their borrowing amount. Everyone the general rule is that supporting borrowers able to afford with their own income. However,
known as supporting borrowers. Importantly on the mortgage is jointly and separately must be a family relation (e.g., parents, brothers, the portion of the loan guaranteed by the
though, only the main buyer is cited on the responsible for the repayments. This means sisters). Anyone who wants to become a guarantors (parents) is usually set for a shorter
title deeds and has sole if the owner cannot make the payments for supporting borrower must take their own term, as it is based on the guarantor’s age. This
ownership of the whatever reason, the supporting borrowers independent legal advice, ahead of doing so. means should the buyer default on mortgage
property. This ensures are liable for the full mortgage payments, the guarantors (parents) are only
supporting borrowers liability and repayments, all Another mortgage opportunity worth responsible for the amount they had agreed to
avoid paying extra whilst not having any ownership considering is the “Guarantor” mortgage. guarantee, instead of the entire mortgage.
Land and Buildings rights to the property. This is like the JBSP mortgage. However, the
Guarantor mortgage is likely to have stricter Want to find out more and how this might
criteria to follow. This type of mortgage is only work for you? Speak to one of our experienced
available for first-time buyers and is usually independent advisors at ESPC Mortgages who
restricted to parents being a guarantor to their can assist.

ESPC Mortgages offer expert independent mortgage advice in Edinburgh. Whether you are looking for first-time buyer
mortgage advice, are interested in finding out more about buy-to-let mortgages or would like to re-mortgage, contact the
team on 0131 253 2920 or fsenquiries@espc.com

The information contained in this article is provided in good faith. Whilst The initial consultation with an ESPC Mortgages adviser is free and
every care has been taken in the preparation of the information, no without obligation. Thereafter, ESPC Mortgages’ charges for mortgage
responsibility is accepted for any errors which, despite our precautions, advice are usually £395 (£345 for first-time buyers). YOUR HOME MAY
it may contain. BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON A
MORTGAGE OR OTHER LOANS SECURED AGAINST IT.
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