While it may seem like an insurmountable task, there are several things you can do if you’re trying to secure a mortgage but you don’t have much in the way of cash. In the UK, it currently costs around £164,000 to purchase a house, according to official figures. This sum is almost completely out of reach for anyone in the UK who’s been ravaged by the global economic downturn, but there are things you can do to work toward your goal of home ownership, if you’re not afraid of asking for a bit of help. Back before the double-dip recession, home lending providers were all too willing to extend credit to nearly anyone and everyone who approached them. However, in the days since the credit crisis, banks and building societies have changed their tune, instead becoming incredibly reticent to lend out of a desire to avoid being caught out in another credit crisis and risking failure through not having sufficient capital held in reserve. The result has been that home lending has clamped down for only but the most low-risk of borrowers. In fact, banks and building societies have put a number of hoops to jump through in order to discourage low income earners, and one of their favourite tactics has been to request deposit amounts as high as 40 per cent in exchange for the most affordable interest rates – and most low income earners have no chance to provide such a high sum unaided. Borrowers have instead been turning to the Bank of Mum and Dad to make up the difference. However, the poor economy has affected everyone, leading to many parents of low income earners being unable to put up a large amount of cash towards a deposit for their child, even when they want to help out their progeny. However, parents with equity build up in their own properties can remortgage their home in order to provide the cash their children need to meet the requirements of a skittish lender. For parents who are reticent to remortgage their home in order to finance the purchase of another, they can act as a guarantor on the loan in exchange for a share of the liability of the second loan.
Related Articles -
mortgage, home loan, low income,
|