Friends and family loans are providing support to first-time buyers
Half of first-time buyers have made the difficult decision to put their plans on hold due to the pandemic; either due to their financial situations (41%) or because lockdown has caused them to reconsider what they’re looking to buy and where (42%).*
With many prospective homeowners feeling pushed out of the market right now, we want to offer our guidance, so that when you’re in a position to proceed as planned, you’re informed and able to make the right choices.
23% of housing transactions are backed by Bank of Mum and Dad (BoMaD)
Loans from friends and family members have been an extremely popular option so far this year, with an estimated 175,000 transactions involving this support type going through in 2020.**
Whilst lenders are currently trying to put a cap on family lending for deposits, it’s thought that the so-called Bank of Mum and Dad will still be behind £50 billion worth of property transactions.
Furthermore, despite the pandemic and the financial strain its put on households, 15% of BoMaD lenders plan to give their loved ones more contribution to their deposit and property purchase than initially intended.
What do you need to know as a first-time buyer?
For everything you need to know before taking that first step, please visit: https://www.which.co.uk/money/mortgages-and-property/first-time-buyers.
*Source: Aldermore
**Source: Legal & General
