Parental advice for Bank of Mum and Dad
The Bank of Mum and Dad has helped fund many first time buyer mortgages but it is worth checking for any stings in the tail.
One good example is a case where a mother sought to take out a joint mortgage with her first time buyer son, as outlined in an ‘Ask the Expert’ column in the media.
In this case, the property purchase would fail to qualify for the Stamp Duty Land Tax (SDLT) relief for first time buyers announced in last Autumn’s Budget.
This is because, to qualify, all purchasers of a property must be first time buyers and plan to live in the home as their main residence.
Of course, it is quite right to make sure that any loopholes are closed off to ensure that the right people benefit.
However, the article does suggest other quite legitimate ways of helping – namely a ‘joint borrower, sole proprietor’ mortgage.