Out & About Spring 2018

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The Bank of Mum and Dad (and now also Granny and Grandad) became the UK’s 9th biggest OHQGHU IRU ¿UVW WLPH EX\HUV LQ 7KLV LV GXH to a number of reasons: rising house prices, slower wage growth and the size of deposits needed as a down payment – it’s no surprise \RXU VRQ LV ¿QGLQJ LW GLI¿FXOW WR À\ WKH QHVW It’s great that you’d like to help boost his chances of getting onto the property ladder, and there are a number of ways you, as the Bank of Mum and Dad, can help: By gifting a deposit – You can gift a deposit sum which will go towards the property purchase. Without a deposit you are unable to buy a property with a mortgage; therefore you can help your son by providing a larger deposit. This could also potentially lower the cost of interest rate that will be payable on the mortgage. Additional borrowing on the family home – Providing you own your home, you can release equity from your property. You can take out a mortgage and gift the funds to your son – no matter your age. Joint mortgage – Sole ownership: When applying for a standard mortgage, parents can help their children borrow more by standing as a joint mortgage borrower. This could potentially increase the size of a mortgage they are able to achieve and enable them to get onto the property ladder. The parent would be jointly named on the mortgage; however the ownership of the property would remain in the name of the child. This means stamp duty on a second home is not payable. My son is struggling to save for a deposit to SXUFKDVH KLV ¿UVW KRPH ,¶P HDJHU WR DVVLVW LI , FDQ I’ve heard the phrase ‘Bank of Mum and Dad’ a few times but don’t really understand it. Can you help? Mr Harris from Newbury How can the Bank of Mum and Dad help my VRQ SXUFKDVH KLV ¿UVW property?

-DQH %RVKHU 6HQLRU 2I¿FH 0DQDJHU DW 1HZEXU\ Building Society’s Newbury branch.

Help to Buy and Shared Ownership – The property sector’s knight in shining armour, the government’s Help WR %X\ VFKHPH SURYLGHV D UHDOLVWLF SODWIRUP IRU ¿UVW WLPH buyers to boost their purchasing power. With as little as a 5% deposit needed and for Shared Ownership a mortgage that requires owning anything from 25% of the share value, getting onto the property ladder is no longer a pipedream. Just remember: Before you make any decisions, it’s always advisable to seek independent advice. Helping your son may seem like the right thing to do, but do ensure that it is affordable for you and any agreements entered into are clear to all parties involved. Good luck! If like Mr Harris, you would like to talk about how the Bank of Mum and Dad can work for you, please contact us and arrange an appointment in a branch local to you or by telephone. We are known for providing D WDLORUHG DQG LQGLYLGXDO VHUYLFH DQG RXU TXDOL¿HG mortgage advisers are also available for appointments on Saturdays. Visit our Newbury branch, call us on 01635 522588 or email newbury@newbury.co.uk . Visit us at: www.newbury.co.uk YOUR MORTGAGE IS SECURED ON YOUR HOME. THINK CAREFULLY BEFORE SECURING OTHER DEBTS AGAINST YOUR HOME. YOUR HOME MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON YOUR MORTGAGE.

Newbury Building Society is authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and the Prudential Regulation Authority (Financial Services Register number 206077). 6862

NEWBURY building society

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