Up to 99% LTV Flexible Family Assist

Family Assist mortgages

At the Tipton, we know how hard it is for some of your clients to get a foothold on the housing ladder due to ever-increasing property prices and the need for large deposits.

In response to these challenges, we introduced our Flexible LTV Family Assist mortgage which lends up to 99% LTV.

Your clients have a number of options for securing the mortgage with the help of a family member. We must have 20% of the property value or purchase price (whichever is lower) as security. We can do this by having up to a maximum of 10% borrower deposit plus a collateral charge against a family member’s property which alongside the deposit will total 20% of the value of the loan. Alternatively, a family member can pay the difference between 20% and the borrowers deposit into our Family Assist saving account and accrue interest.

Collateral Charge Option

A collateral charge provides a sensible alternative for parents and family members who want to help relatives onto the property ladder, but who are not in a position to gift a cash sum.

To secure the 99% LTV mortgage, we would use the difference between any borrower deposit and 20% of the value of the loan against the family member’s property, as long as the property has 40% equity at the point of application. Exercising the collateral charge would be a last resort, enforced only when all other options for maintaining repayments had been explored.

A standard valuation will be needed on both the purchase property and the family member’s property, this will be at your client’s expense. Your client will also need to pay for their own legal costs and their family member’s independent legal advice. This is needed for us to consider the mortgage.

We will need the client’s family member’s written consent for us to carry out a credit check against them. They will not be included in affordability assessments and no further income assessments will be carried out against them.

Savings Deposit Option

After listening to feedback from our broker network, we now offer a savings deposit option for parents or family members looking to help relatives onto the property ladder. Again, the amount to be deposited into the savings account by a family member will be the difference between any borrower deposit and 20% of the loan amount.

The savings deposit option is designed for family members who want to earn interest on their deposit, rather than gifting it to the relative. On depositing into our Family Assist savings account, the sum would accrue interest at our current rate and could be withdrawn once the borrower reaches 80% LTV.

YOUR PROPERTY MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON YOUR MORTGAGE.

Flexible LTV

Our Family Assist products require us to have 20% security, this is calculated on the purchase price or property value (whichever is lower). This is usually taken in the form of a collateral charge on a family members property or them depositing into our specified savings account.

With our Flexible Family Assist product, the 20% security can be made up of a maximum of 10% borrower deposit and either the collateral charge or savings options detailed above, in any ratio best suited to the borrower!

YOUR PROPERTY MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON YOUR MORTGAGE.

Mortgage amounts

There is a minimum mortgage amount of £75,000 increasing to £250,000 for properties located outside the M25 corridor.

This product offers a maximum mortgage amount of £250,000 increasing to £400,000 for properties located within the M25 corridor.

The maximum loan to value this product offers is 90% of the purchase price.

YOUR PROPERTY MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON YOUR MORTGAGE.

Mortgage repayment terms

There is a minimum repayment term of 5 years and a maximum repayment term of 35 years.

YOUR PROPERTY MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON YOUR MORTGAGE.

Early Repayment Charges

Up to 10% of the original mortgage amount can be overpaid each year without charge. If the mortgage is redeemed or switched to another product during the fixed rate term then an Early Repayment Charge will apply.

The Early Repayment Charge will be calculated at:

• 6% until 30 November 2020;
• 5% until 30 November 2021;
• 4% until 30 November 2022;
• 3% until 30 November 2023;
• 2% until 30 November 2024; and
• 1% until 30 November 2025.

YOUR PROPERTY MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON YOUR MORTGAGE.