Parents helping FTB

skyela

Hello,

I hope someone out there could help, I would be grateful for any replies, as I can't find any info on this sort of scenario.

I have recently seen a property that is perfect for me, it's on the market for 165k but I hope that the seller may take closer to 155k as near enough the same house down the road has just sold for this recently.

I have a deposit of 27k saved at the moment. I know banks will only lend about 3.5x your income roughly. I currently earn 18k, (and take home 1.5k in bonus every year - I don't think banks would count the bonus though) So assuming they lend that it's 3.5x = 63k.
So that gives me 90k.

My parents have offered to lend me the remaining amount needed. Are they allowed legally to do this?
From the banks point of view I would have 92k of our money put into it, so the bank would only need to lend 63k on the whole 155k amount.

I do not have any loans / credit cards / or any other financial commitments.

Does anyone know if this is possible?

Thanks for any help.

herbiesjp

Well potentially you can get more than 3.5 times your income.

However, if parents "lend" you the money the lender would expect that the "loan" be repaid and would therefore make relevant deductions from your income.

If your parents gifted you the money, and did not want, any interest or repayment of the lump sum, then that would be fine - and they would want a letter to that effect.

Legally all fine.

skyela

herbiesjp wrote: »

Well potentially you can get more than 3.5 times your income.

However, if parents "lend" you the money the lender would expect that the "loan" be repaid and would therefore make relevant deductions from your income.

If your parents gifted you the money, and did not want, any interest or repayment of the lump sum, then that would be fine - and they would want a letter to that effect.

Legally all fine.

Hi,

Thanks for your reply.

Do you know what is roughly the max multiple income they will lend?

Well I would want to pay my parents back at some point, if not now then certainly in a few years when everything's settled. My partner would also be moving in with me but he's only working part time at the moment, but would be contributing to paying the mortgage so we could afford to pay the mortgage and save to pay my parents back at the same time. Would the lender need to know this?

herbiesjp

The lender will need to know of anyone else living at the property.

With your partner's income you may get closer to the mortgage amount needed - what is their income?

You could look at 4 times income, maybe more, maybe less - but it would depend on your whole scenario.

skyela

herbiesjp wrote: »

The lender will need to know of anyone else living at the property.

With your partner's income you may get closer to the mortgage amount needed - what is their income?

You could look at 4 times income, maybe more, maybe less - but it would depend on your whole scenario.

Ok, thats fine. I'd let them know.

I don't think so, he's earning about 6k at the moment - so it's not worth much on the application. He will be working full time soon however, but I guess thats not much use for this house.

Ok thanks for your help.