Skipton offers 'bank of mum and dad' mortgages to help housing crisis

Wednesday 01 June 2022

Skipton International is reminding islanders about its ‘next generation’ mortgage as one route through the island's housing affordability crisis. It provides a way for parents to help their adult children purchase their first home using the equity in their own property.

The 'next generation' mortgage allows first time buyers to purchase a home without having to save up for a deposit. And it assists parents who want to help their children get a foot on the housing ladder but who are unable to gift the required deposit.

Effectively a 100% mortgage, the ‘deposit’ is secured on the parents’ property, meaning there is no need for parents to gift money, apart from any relevant legal and valuation fees.

With the average price of a property now around 16 times the average earnings of a single person, many homeowning parents have strong equity in their homes and they may want to use it to help their children. 

Roger Hughes, Skipton’s Business Development Manager, said: "It’s no secret that the property market is becoming more and more out of reach of first-time buyers, who now need a significant deposit in order to stand a chance of getting onto the property ladder.

"I speak to many parents whose children are in their 20s and 30s and are still living at home in order to save for a deposit – and all the while, property prices continue to rise.

"By considering the 'next generation' mortgage, parents can utilise their own property to help their offspring make that first step to property ownership.

"My team and I are always available for any enquiry, whether from the parents or the children and will happily explain how it works and what can be borrowed."

Pictured (top): Roger Hughes.