Guarantor Mortgages

Guarantor Mortgages are used by the younger generation, and the reason for using Guarantor Mortgages is that they usually can not afford the repayments but would be able to afford them as they got older and advanced in their job roles and their income increased.

Guarantor Mortgage or Mortgage Guarantor lending pricipals will differ from lender to lender but some common factors will appy to all lenders, these generally are:

1. Affordability will be assesed on the Mortgage Guarantor (has to be close family mum dad) income.

2. The Mortgage Guarantor Property would be expected to have enough equity in it to pay of the sons daughters mortgage if it was repossesed, if there is not enough equity in the parents property all lenders will decline

3. The children would be expected to take over the mortgage payments with in 5 years of the parents becoming guarantor.

4. Parents home will be used as security and they will apply for the mortgage for their childrens proeperty not the children.

5. In the currnet market you will still need to find a deposit using KPM Financial Service we have products upto to 90% LTV, on this basis you would still have to find 10% irrespective of how much equity is in the parents home

The above is a guide and a Mortgages With Guarantor lending criteria will differ from lender to lender so you would be better fo speaking to an independent mortgage broker from KPM Financial Services as this area of morgtage lending is very complex.

To calculate the amount you can borrow, the lender will multiply the guarantor’s income, but then subtract any outstanding credit commitments, such as their own mortgage or other loans. Some lenders require the guarantor to only cover the shortfall on the mortgage, while other mortgage companies require proof that the guarantors are able to cover the full house purchase amount. Lenders are able to offer more money towards a guarantor mortgage because they have combined incomes supporting the loan.

Talk to KPM Financial Services about Guarantor Mortgage lenders and the implication this has if you decide to be a Guarantor For Mortgage, it could be the best advice you ever recieve