Boost your deposit
So you need a deposit for your first home. And your family want to help.
Don't worry if your family don't have savings they can support you with. Or if they don't want to dip into their savings pot. They don't need to!
Your family member could borrow a little extra to give you a deposit.
Here's how additional borrowing works:
There are a few ways you can do this. Whichever option they choose, your family member will need to meet our lending criteria and pass our affordability checks.
If your family member has a Principality mortgage they can either:
- Remortgage with Principality when their current deal ends. And talk to us about their options for borrowing a little extra
- Take out an additional small mortgage. This option can be done at any time. There's no need to wait until their current mortgage deal comes to an end
If your family member has a mortgage with a different provider:
They can switch to Principality when their current mortgage deal ends. If they remortgage with Principality, we’ll talk them through their options for borrowing a little extra
If your family member has paid off their mortgage:
- They can take out a new mortgage to release funds
The important stuff
Who can gift a deposit through additional borrowing?
A gifted deposit can come from your spouse, grandparent, parent, sibling, child, grandchild, or a legal guardian.
When should they apply?
We’ll need to release the funds at the same time as your mortgage application is accepted. Your family member should get in touch to talk through their options first. Then we’ll walk you all through the process.
If they're taking out a new mortgage, or coming to us from another provider, its a good idea to allow plenty of time to complete the application. The sooner they talk to us, the better.
Protecting everyone involved
When someone gifts a deposit, it means they don’t expect you to repay the money. We’ll ask you to fill out a form making this clear for everyone involved. Everyone involved may want to consider getting independent legal advice too.
What you need to know:
- The borrowing will be secured against your family member's property. They need to:
- be sure they can afford the repayments
- understand it could affect their remortgage options in future
- When additional borrowing is combined with an existing mortgage, the total amount cannot exceed a set loan to value (LTV) threshold. Thresholds are:
- 90% LTV for residential properties
- 75% LTV for Buy To Let or holiday let properties
- The minimum term is 2 years and maximum term is 40 years.
- No additional borrowing can be considered for at least 3 months from the start of a mortgage.
- You cannot borrow more if you are in arrears.
- You must be able to demonstrate a satisfactory payment history.
- Applications for additional borrowing must meet our current lending requirements.