Family springboard mortgages
Discover how a family springboard mortgage could help you buy your first home with no deposit.
What is a springboard mortgage?
A family springboard mortgage is a type of mortgage designed to help first-time buyers who are struggling to save up a deposit.
Rather than provide your own deposit, a family member will use their savings as the security for the property. Family springboard mortgages are a product specifically offered by Barclays, but there are other similar deals, including:
Family boost mortgages (Halifax)
Family deposit mortgages (Nationwide)
Lend a hand mortgages (Lloyds Bank)
They all work in similar ways and are essentially a type of guarantor mortgage, where a family or loved one helps you get your first mortgage.
How do springboard mortgages work?
A family member will effectively use their savings as the deposit for your mortgage. However, instead of the money going towards the purchase of the property, it is invested into a savings account with the lender.
They will need to provide at least 10% of the property’s value, and it will be held in the account for a set period of time, usually five years. Once deposited, it’s not possible to add or remove money from the account.
At the end of the term, they will get the money back, plus any interest earned, provided you keep up with your repayments. The family member won’t own any part of the property, nor will their name appear in the title deeds.
What happens if I default on my mortgage?
If you fall behind on your mortgage payments, the lender may hold onto the savings for longer than the agreed term. If they need to repossess the property, the family member could lose some or all of their money.
For this reason, the lender may ask the family member to get independent legal advice before agreeing to help you get a springboard mortgage.
What family members can help?
Any member of your family can help and participate in a springboard mortgage with you. Typically, this will be parents, grandparents or guardians, but it could be a sibling, aunt or uncle or your children.
Some lenders don’t specify that only family members can help and will allow friends to participate, provided they understand the risks involved.
Are springboard mortgages a good idea?
A springboard mortgage can be a good way to help you buy your first home; however, you will need to have a family member willing and able to help you.
There are several pros and cons to springboard mortgages that you and the family member helping you should consider before applying.
Pros and cons of springboard mortgages
Pros of springboard mortgages
No deposit
They can help you get onto the property ladder without a deposit.
Own the property
You own 100% of the property outright yourself.
Better rates
You could access a better interest rate than with a 95% mortgage.
Earn interest
The family member will earn interest on the money they deposit.
Cons of springboard mortgages
Money at risk
The family member helping you will be putting their money at risk.
No access
They will be unable to access their savings for the set period.
Negative equity
With a 100% mortgage, you are at risk of going into negative equity if house prices go down.
Higher rates
The interest rate may be higher than if you can put down a deposit of 10% or more.
Alternatives to springboard mortgages
There are other ways that family members can get you on to the property ladder, including:
Guarantor mortgages work in a similar way to a springboard mortgage. However, rather than providing savings as security, the family member agrees to make your mortgage payments if you fall behind and may use their own property as security for the loan.
This means that the family member provides the deposit required for a property purchase without it needing to be repaid. This means you could access more products, but your family member won’t get their money back.
This is a type of joint mortgage where a family member enters into the mortgage with you. However, you will solely own the property, but they will share the responsibility for repaying the mortgage.
Alternatively, you could look to take advantage of government schemes designed to help first-time home buyers. These include:
These schemes are aimed at those struggling to save up a deposit or those who can’t afford to borrow enough to buy their first home.
Our expert says...
“Getting your foot on the first rung of the property ladder is more challenging than ever, but a family springboard mortgage can help.
“It’s a way for family members to help while also earning interest on their savings - however, there are still risks involved. Our expert advisors can discuss all your options to help you determine if a springboard mortgage is right for you.”
Springboard mortgages FAQs
No, springboard mortgages are designed to be taken out with no deposit provided by the borrower. That means you’ll get a mortgage worth 100% of the property you’re buying.
However, it is possible to contribute a deposit if you have money saved up, with 95% springboard mortgages available.
How much you’re able to borrow will depend on your income and affordability. As you’re getting a 100% mortgage, you will need to be able to borrow the total purchase price of the property you want to buy.
Most lenders will lend up to 4 or 4.5 your annual income. For example, if you earn £35,000, you could potentially borrow £157,500 (£35,000 x 4.5).
How much you can borrow can also be influenced by your affordability. If you have a lot of outgoings, especially in the form of debts, how much you can borrow can be reduced.
It is possible to get a springboard mortgage if you have bad credit. In fact, it could be easier to get a mortgage with help from your family than it would be to get one on your own.
Having the security of your family member’s savings means that lenders will see you as a lower risk, even if your credit score isn’t the best.
However, if you have a poor credit record, it can reduce how much you can borrow or could mean you’re offered a higher interest rate.
You will own the property outright with a family springboard mortgage, and the family member who uses their savings to help you will hold no stake in the property.
A family deposit mortgage is a product offered by the Nationwide Building Society. Your family member will need to have a mortgage with Nationwide, and the equity in their home is used as security rather than their savings.
This can be more risky, as your family member’s home may be at risk if you can’t keep up with your repayments. However, it also means they don’t need to tie up any of their money in a savings account for three or five years.
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Important info & marketing claims
You may have to pay an early repayment charge to your existing lender if you remortgage. Your savings will depend on personal circumstances.
Your home may be repossessed if you do not keep up repayments on your mortgage.
*The savings figure of £656 is based on Better.co.uk remortgage customers in April 2024. Read more on our marketing claims page.
We can't always guarantee we will be able to help you with your mortgage application depending on your credit history and circumstances.
Average mortgage decision and approval times are based on Better.co.uk's historic data for lenders we submit applications to.
Tracker rates are identified after comparing over 12,000 mortgage products from over 100 mortgage lenders.
As of January 2023, Better.co.uk has access to over 100 lenders. This number is subject to change.
For buy-to-let landlords, there's no guarantee that it will be possible to arrange continuous letting of a property, nor that rental income will be sufficient to meet the cost of the mortgage.
