Thursday, March 22, 2007
Category:
Secured Loans
Recent news from Abbey shows that one in ten first-time buyers plan to ask their parents for financial help when buying a house.
The figure is less than that quoted in the 2006 survey but 45 per cent of potential new homeowners anticipate that their Mum and Dad will help financially when they move into their new properties. Half of the 45 per cent believe their parents will not expect to get their money back.
Although first time buyers looking to get onto the property ladder are less likely than before to ask their parents for help in purchasing their new home, it is probable that they will still help out with the move. The type of help first time buyers are expecting from their parents includes acting as guarantor for the mortgage, help moving into their new home, help with DIY, decorating and buying new furniture. Offspring also expect parents to accompany them on property viewings.
Nici Audhlam-Gardiner, Head of Mortgages at Abbey, said: ‘The decline in the number of potential homeowners relying on their parents is a positive indication that first time buyers are finding alternative ways of funding their homes. Certainly part of this is due to the rise in the number of mortgage providers offering better solutions to suit the needs of would-be homeowners.
Though first time buyers still face problems getting on the property ladder, they still aspire for the perfect first time home. 24 per cent of first time buyers aspire for a country cottage, while 20 per cent hope to buy a town house. 14 per cent look to purchase penthouses or city apartments.
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Parents who want to help their kids onto the property ladder could consider a
secured homeowner loan to help provide their children with a deposit. Secured loans can be repaid over a term of 5 to 25 years and parents can borrow up to £100,000. Secured loans are only available to homeowners and form a second charge on the borrower’s property. One of many options, parents may want consider a secured homeowner loan to help kids make over their new property in addition to helping with the deposit.
