Vida Homeloans is the first specialist mortgage lender to join the Joint Borrower Sole Proprietor (JBSP) market sector, launching its Helping Hand product to assist parents in getting their children onto the housing ladder without being on the title deeds and jointly owning the property.
For first-time buyers (FTBs) and their parents, this means that no stamp duty surcharge is payable by the parents and their children could take advantage of stamp duty being abolished for FTBs purchasing homes priced up to £300,000.
According to recent research from Legal & General, the bank of mum and dad continues to be a top ten UK mortgage lender and is set to lend £5.7bn in 2018 in the UK. Additionally, as part one Vida’s solutions designed for the FTB market, the Helping Hand product allows parents to help their child by allowing them to be a joint party to the mortgage and have their income taken into account as part of the affordability assessment. As the lender has now joined the JBSP, it can also provide an easy exit strategy when the child’s income increases and they can afford the mortgage in their own right.
Vida’s Helping Hand is available up to a maximum of 90% LTV for FTBs and it can be combined with gifted deposits, the self-employed and four applicants buying together.
Vida Homeloans director of mortgage sales Louise Sedgwick said: “At a time when First Time Buyers are facing significant affordability constraints and house prices continue to rise, we think that Vida’s Helping Hand mortgage will provide a new and interesting option for mortgage intermediaries who want to provide solutions to parents trying to help their children onto the housing ladder. It combines the advantages of a Joint Borrower Sole Proprietor mortgage with our specialist approach to customers who may not fit the criteria currently demanded by high street lenders.”
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