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Author: By Ed Parry


Mortgagesorter >> First Time Buyers

Guarantor Mortgages for First-Time Buyers


If you are having trouble finding a mortgage lender willing to lend as much money as you need, either because your salary is low, you already have a lot of debt or you’re buying in a expensive area, you might find they become more amenable if you come up with a guarantor.

What is a guarantor? A mortgage guarantor is someone who promises to take responsibility for your mortgage. They guarantee that if you default on your mortgage either because you can no longer afford, or are no longer willing, to pay – they will make the mortgage payments, eventually clearing what you owe.
This is potentially a major financial commitment.

Once the deal has been signed, your guarantor is legally bound and they can be made to pay out at any time during your mortgage term even if it means selling their own home.

Your lender is unlikely to agree to release them unless you find an acceptable replacement, or your salary or the value of your property has risen significantly. Who can be a guarantor? It is most usual to ask a parent, but any relative or even a long-standing friend can act as a guarantor. To be acceptable to a lender, they must prove they have enough disposable income, after paying their own debts, to afford your monthly repayments too.

But don’t forget this is not an easy option, as you will still have to make the monthly repayments. If you can’t, or won’t, you will be putting your guarantor in a very difficult position, as they will be legally obliged to cough up regardless of the hardship it causes them.

 

Read On:

Intro / What You’re Getting Into

Process / Flow Chart Of What Happens

Buying Your First Home

Be Careful Out There

Don’t Just Grab The First Mortgage You Can

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Problem: Having Enough Money

Guarantor Mortgages

100% Mortgages For First Time Buyers

Should I Borrow Five Times My Income?

Having Problems As A First Time Buyer? Read Some Solutions

UK Government Help, Homebuy And Key Workers Schemes

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Buying As A Couple

Already Own Separate Homes?

TIPS For First Time Buyers

 


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