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THE FAMILY MORTGAGE - 95% LTV MORTGAGE

The principle behind the Family Mortgage is simple. 

It helps families help family members take the first step on the property ladder.

As long as you have at least a 5% deposit (which can be wholly gifted), and you have family that can give us additional security by using their savings or having a charge on their own property, we may be able to help.

Family members can help you by:

  1. Putting their savings in our Family Security Account, which earns them interest too
  2. Providing a charge over some of the value in the property, so there's no need for them to use their savings
  3. Placing their savings in our Family Offset Account at the start of the mortgage. This reduces the amount of the mortgage on which we charge interest by the amount held in that account. This means family members won't earn any interest on savings in the Family Offset Account.

The additional security family members provide will need to bring the total security we have (your deposit and the help from your family members in one or more of the ways we list above) up to 25% of the property value.


The following short video explains how the Family Mortgage works...

What next?

You probably have a lot of questions about how the Family Mortgage could work for you - we are here to help!

We have two calculators that show how the Family Mortgage works. Try our affordability calculator to see how much you could borrow, or try our repayment calculator to see what your monthly repayments with the Family Mortgage would be.                

For more information read our Family Mortgage Lending Criteriafrequently asked questions from the buyer and our frequently asked questions from the family helping the buyer.

Things to consider

We know there’s lots of things to think about with our Family Mortgage and getting some help from your family to buy a home. That’s why we’ve produced a series of guides about the ‘Bank of Mum and Dad’ to help you with some of those conversations you may be having with family right now. 

With our Family Mortgage, it’s important both you and family members understand that by offering security for your mortgage with their savings or by placing a charge on their property, family members are responsible for making up any shortfall if you sell your house for less than the mortgage value, which is known as negative equity. 

Working with family members helps buyers:

  • get lower interest rates, meaning lower monthly payments;
  • pay interest on a smaller amount of the mortgage, meaning lower monthly payments;
  • increase your buying power when choosing a property to buy.    

Working with buyers helps family members to:

  • put assets to work for the buyer as security for the mortgage;
  • help the next generation own their own home without giving the money as a gift.

Follow these links to find out more about how the Family Mortgage could work for you:

You can use one, two or all three of these methods in combination to help a buyer get the home they want.



Representative example

A mortgage of £217,920.00 payable over 30 years initially on a fixed rate for 5 years at 2.99% and then on our variable Managed Mortgage Rate, currently 4.39%, for the remaining 25 years would require 64 monthly payments of £917.58 and 296 monthly payments of £1,062.00 plus one initial interest payment of £553.29.

The total amount payable would be £374,579.41 made up of the loan amount plus interest of £155,785.41 and an Application Fee of £175, Product Fee of £599 and a Mortgage Exit Fee of £100.

The overall cost for comparison is 4.0% APRC representative.

THE MORTGAGE WILL BE SECURED ON YOUR HOME. YOUR HOME MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON YOUR MORTGAGE.

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Family Building Society
Ebbisham House
30 Church Street
Epsom
Surrey KT17 4NL
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