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How the Family Deposit Mortgage works
The Family Deposit Mortgage enables the purchaser to obtain an affordable 95% mortgage with only a 5% deposit, whilst a family member provides the equivalent of 20% of the property value, which is deposited usually for 5 years, in a Family Deposit Mortgage-Savings Account. The family member earns a healthy rate of interest on their savings during this period and gains full access to their savings after 5 years, depending on the mortgage performance.
What you need to get started
- A minimum deposit of 5% of the property value.
- A family member willing to put aside savings up to the equivalent of 20% of the property value into our Family Deposit Mortgage-Savings Account for five years.
- The deposit can be higher than 5%, but the total value of the deposit and savings must be equivalent to 25% of the property value.
The savings will earn interest which will be paid annually into either this account or to one you nominate. Please see the Family Deposit Mortgage-Savings Account Product Page for more information and details of current interest rates applicable.How the account worksThere is a charge placed over the savings in the Family Deposit Mortgage-Savings Account. This means that in the event of the borrower failing to make repayments on the mortgage and the property being repossessed and sold for an amount less than the sum owed on the mortgage, some or all of the savings will be used to cover the loss to the Society. Any funds remaining will be available for withdrawal. No withdrawals are permitted on this account until the charge over your savings account is released, usually after 5 years.
The Saver must seek legal advice (this will be a condition of the mortgage offer) and savings funds must be received by the Society and cleared at least 14 days before the mortgage completes.
If you have any questions or would like to talk through any of our mortgage products, please contact our Mortgage team on 01858 412610 - they will be happy to help.
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