Focus on: Woolwich launches Helpful Start for first-time buyers
Woolwich - the mortgage lending arm of Barclays - has unveiled a new mortgage scheme called Helpful Start that allows struggling first-time buyers (FTBs) to factor their family's income into the affordability equation.
The launch comes on the back of research by the bank that owning your home rather than renting could make you £194,000 better off in 50 years' time.
And this figure does not even include the value of the home you would own at that stage.
However, getting that first foot on the property ladder is the problem for many cash-strapped tenants, which is where Helpful Start comes in.
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But what exactly is the scheme and could it help you or your offspring get on the property ladder? We take a closer look to find out.
What's the deal?
Helpful Start, launched on Monday, June 18, can be applied to all Woolwich mortgages.
FTBs can therefore apply the incorporated Family Affordability Plan, which means both the young person and his or her parent's income are used to calculate the mortgage amount, to the entire Woolwich range.
Woolwich mortgages that could be taken out with Helpful Start therefore include a four-year fixed-rate deal priced at 6.19% with a £999 fee and a minimum deposit of 10%.
For those struggling to scrape together 10% of the value of the property they want to buy, there is also NewBuy range that includes deals requiring a deposit of just 5%.
The terms of Helpful Start are designed to come without catches. They allow parents to help their children get on or move up the property ladder without their names being on the property deeds.
This means they won't face any Capital Gains Tax issues or complicated property ownership arrangements when the house comes to be sold.
And, as and when the young buyer's own affordability becomes robust enough to take on the property alone, no transfer of equity involved - it is purely theirs in their own right.
However, parents concerned about protecting their rights or wanting something back from the property in the future should be aware that their legal entitlements will be less clear-cut as a result of not being on the deeds.
Helpful Start is not a scheme for all FTBs and their families - particularly as it does not help with raising that all-important first deposit.
However, it does provide a new, slightly different option, and will appeal to all those whose relatively low incomes prevent them from buying the house or flat of their dreams.
For the millions of parents who cannot spare the cash to fund a larger deposit, it also offers a way to help their children move on with their lives.
This is especially true as the Family Affordability Plan can be applied across the entire Woolwich mortgage range, including NewBuy mortgages that allow you to borrow up to 95% of a property's value.
Usefully for those wanting to move up the ladder, it is also open to second and third-time buyers as well as FTBs.
Helpful Start is not the only scheme through which parents can help their children get on to the housing ladder.
Other similar schemes that are also worth a look if you are desperate to buy include Lloyds TSB's Lend a Hand.
It enables parents - or other relatives or friends - with savings to put their money up as additional security for a mortgage.
However, while only a 5% cash deposit is required, the sum of the deposit and the savings put forward as security must equal at least 25% of the property's value.
Whoever is providing the cash will therefore need to stump up a significant amount to help with most property purchases - although they will receive a reasonable 3.70% for the initial three-and-a-half year term.
Unlike Helpful Start, Lend a Hand is limited to one specific mortgage deal, with a fixed representative APR of 4.4%.
Please note: Any rates or deals mentioned in this article were available at the time of writing. Click on a highlighted product and apply direct.