With most loans today being based upon income multiples and increasing property prices, first-time buyers require larger and larger deposits to be able to purchase their first home.

A lot of parents and increasingly grandparents are re-mortgaging their own homes to be able to provide the deposit required, now often referred to as “The Bank of Mum and Dad.”

There are today a number of innovative lenders who can approach this form of specialised lending differently. Some will take the parents’ home as security for a number of years by putting a temporary charge on the property, therefore not needing to re-finance the main property.

Others will consider the incomes of both parents as well as the applicants, taking into account all outgoings of course. Some lenders will insist on the parents being party to both the mortgage and the property, while others only require them to be party to the mortgage.

The implication of parents being party to the property is that it may have stamp duty consequences.

It is now easy to see just how complicated the idea of helping out your children can potentially be! Seeking professional advice is clearly the best way forward, as professional mortgage advisors have an understanding of just how different lenders work, which is essential to ensure you get the right product for your circumstances and understand all the implications.