A Guarantor Mortgage allows a third party (maybe your parents) to underwrite your mortgage repayments and obligations. But why would you want that?
Well, if you need a mortgage and you can’t get one this is worth considering. Perhaps your lender is concerned about whether you can afford the mortgage or they have concerns about your employment history? If so, one option is to offer them a guarantor who will guarantee to take on your mortgage obligations if you default.
This type of mortgage can be useful when a parent wants to help a son or daughter get onto the property ladder. However, there are risks associated with this type of mortgage as the guarantor is liable for any defaults. Their own home might even be at risk if they fail to cover their commitments.
As an alternative to a Guarantor Mortgage, it might be worth Mum and Dad participating in the purchase by buying part of the property and taking on part of the equity. On this basis it would be reasonable that they receive rent on the proportion of the property they own. Of course, shared equity purchase isn’t new but the big advantage is that, as a joint owner, your co-owner might introduce a larger deposit meaning that your mortgage is available on better terms. Also, as with a Guarantor Mortgage, your co-owners can also responsible for the mortgage repayments but with shared ownership at least they own part of the property!
In any event, what is becoming clear is that with ever-rising property prices the lenders and the UK Government are keen to introduce new ways for people to get on the property market. The Guarantor Mortgage is one such instrument.
Anyone considering a mortgage should contact an Independent Mortgage Adviser. Contact Mortgage Required on 01628 507477.
Related articles:
Download our Free First Time Buyers Guide
Recent posts
On Wednesday, 13th May, King Charles delivered his speech at the House of Lords, outlining the government’s plans for the upcoming year.
Here is a summary of the housing and energy/environment points.
From 18th May 2026, Lloyds Banking Group is launching a ‘£5k Deposit mortgage’ to help first-time buyers get onto the property ladder sooner.
Homeowners could be faced with paying over £3,000 more per year on their mortgage if the conflict in the Middle East continues, following new analysis from INTEREST from Moneyfacts.
Best UK Mortgage Rates this Week
9 days ago
Here are the lowest fixed mortgage rates of the week, available to first-time buyers, home movers, buy-to-let, and those remortgaging.
Call us for more information: 01628 507477 or email: team@mortgagerequired.com.
Renters' Rights Act
17 days ago
The Renter’s Rights Bill became law at the end of October, which means it has been signed off by the King, and it is now the Renters’ Rights Act. Despite this becoming law, these changes are likely to start changing within the next six months, with the aim of being fully implemented throughout 2026 and into 2027.
Green Mortgages | Rewards and Benefits
17 days ago
Mortgage lenders are starting to recognise their “Green” responsibilities when it comes to the different products they offer.
Costliest Streets in Great Britain
21 days ago
Recent data from Rightmove shows the most expensive streets in Great Britain, with the majority being situated in the capital.
The Bank of England Governor, Andrew Bailey, has advised that, due to the “very big energy shock” the economy is facing, they won’t be in a rush to increase UK interest rates.
More information
Trusted by
