Barclays offers a new ‘mortgage boost’ function with which first buyers can improve their loan power with the support of family and friends.
The mortgage provider introduces this initiative at the same time that the research published that the average age of a first buyer in the UK last year unveiled last year.
Only two years ago was the typical age of 31 and emphasized the scale of the affordability challenges with which first buyers are confronted.
And it also shows the need for product functions such as Barclays Boost to help buyers for the first time to take their first step on the real estate ladder.
So how does it work?
Boost is aimed at people whose Income does not extend To meet the suitability needed to buy a house.
For example, if the first buyer in question earned £ 37,500 a year and would have a down payment of £ 30,000, the maximum they could borrow would be £ 168.375.
However, if they benefit from the mortgage boost, together with the support of a parent who also had an income of £ 37,500, they could borrow a total of £ 270,000 to buy a house worth a maximum of £ 300,000.
The person who helps, let’s say that it is a parent, will participate in the mortgage application as the aforementioned party, but they will not possess the property or be called on the title deed.
Their income would be easily used to increase the amount that can be borrowed under the mortgage.
However, if the buyer defaults the mortgage, the parent would also be liable. As such, they are subjected to full credit controls and they must also set independent legal advice to ensure that they understand the impact that the mortgage could have on their own finances.
Sian Mcintyre, director of life in Barclays, said: “Buying a first house is a hugely important step in life and one that has unfortunately become more difficult for many in recent years.
“We know that people feel that they have to make huge compromises to save for a large down payment, and that family may want to help, but it can’t afford it.
“Mortgage boost can help answer these challenges and support people to buy their first home earlier and without giving up their other dreams.”
MortGage Boost is available for both first buyers and existing homeowners and can be used in all Barclays Standard Residential Products, so applicants have access to new remortage rates offered. It can also be used to request mortgages for buy-to-off.
Mortgage Boost cannot be used in addition to other special products or schemes, including Family Springboard, Right to Buy, First Home Fund, Help to buy equity or mortgage guarantee.
You can find out more about Mortgages aimed at first buyers here.