Nationwide launches new Family Deposit Mortgage
Nationwide Building Society has announced it is has launched a new range of mortgages designed to allow families to raise funds from their existing property to help another family member buy a home.
The flexible Family Deposit Mortgage is aimed at relatives looking to support one another, such as homeowners helping their children to take their first steps onto the property ladder.
But the range of mortgages is also available to help those moving to a new home as well as relatives looking to assist older parents.
How does it work?
Both existing Nationwide mortgage members and those remortgaging to the society from another lender can apply for the Family Deposit Mortgage to raise extra capital for a family member. In other words you can take additional borrowing and give the money to your children.
The buyer receiving the funds must take out their own mortgage with Nationwide, selected from any product in the standard mortgage range.
All of the additional monies raised by the person giving the money to a relative must be provided as a fully gifted deposit. Those with no current mortgage on their homes, and those in receipt of retirement income, can also make use of the Family Deposit Mortgage to raise deposit funds.
Those gifting the deposit to the buyer can access up to a total mortgage borrowing of 80 per cent loan to value (LTV).
New borrowers – those remortgaging to Nationwide and raising additional capital with the sole purpose of helping a family member buy a home – can access the Family Deposit Mortgage to raise the funds required.
The mortgages come as a two-year fixed rate, five-year fixed rate and two-year tracker rate mortgage deals with a £999 fee or no fee.
Rates start at 1.15% for the two-year tracker and 1.20% for the two-year fixed rate, both with a £999 fee, a discount of 0.09% on the core product range.
Nationwide’s head of mortgages Henry Jordan said: “Our Family Deposit Mortgage range has been launched in recognition of customer demand for a flexible and accessible way to use the wealth tied up in people’s homes. The aim is to help not only first time buyers but also home movers to secure their own property.
“We know that trying to raise a deposit can be the most significant barrier to becoming a home owner. This Nationwide range will enable families to give mutual support to each other and provide new options for home ownership.”