Blog

  • 5th Jul 2018
  • Worried About the ‘Bank of Mum and Dad’? Here’s Your Answer

    The number of homebuyers, particularly first-time buyers, receiving a contribution from parents or other family members towards the deposit has become increasingly common in the last decade. It is also frequent for parents to act as guarantors for homebuyers to boost borrowing allowances for first-time purchases.

    The Legal and General Group predicts that the ‘bank of mum and dad’ will lend or give approximately £5.7 billion this year alone, with 316,600 Brits getting help from family – three in every five homebuyers aged under 35, one in five 45 – 55-year-olds and 8 percent of the over-55s – totalling at an increase of almost 19,000 people since 2017.

    According to the same report, in 2018 one in four housing transactions in the UK will be dependent on the bank of mum and dad, while hard-pressed parents are finding it more difficult to provide the funds to help their family with deposits, which will further contribute to the UK’s housing crisis.

    The concept of the bank of mum and dad can be especially difficult for parents if they feel pressured to be able to help and/or must make sacrifices to make this possible. Moreover, those accepting help may feel in debt to their parents, causing strain on the relationship at a time where support is needed most as a first or second time buyer.

    To overcome this problem and give first and second time buyers further options to get on the property ladder, Harron Homes have a number of schemes to help you purchase your new home without needing to call on family members for support.

    The government’s Help to Buy is a scheme which allows the purchase of a home with only a 5% deposit and is available for all homes up to £600,000 for both first time buyers and those who are purchasing a home for the second or third time. This means you only need a 5% deposit to buy a Harron home, thanks to a 20% Government backed equity loan, while the other 75% is made up by a mortgage from your bank or building society.

    For those already on the property ladder, we also offer our Homemover Scheme. Once you reserve your home, Harron Homes will help sell your existing property, so you can benefit from no estate agent fees, peace of mind and up to six weeks exclusivity on your chosen home. Help to Buy can also be used alongside this scheme.

    And if you’re looking to exchange your house for a brand new Harron home, their Industry Leading 100% full value Part Exchange Scheme guarantees a cash buyer for your existing property, no estate agent fees and no property chain to contend with.

    To learn more about the Harron Homes portfolio and our homes, view our excellence brochure to see the different options available to you; for more details on the above mentioned schemes, view our Purchasing Assistance page. To talk about available opportunities and most recent developments, please get in touch.