A Joint Borrower Sole Proprietor (JBSP) mortgage might be the answer you’re seeking! This innovative financial solution allows up to four individuals to be named on the mortgage, with only one or two holding the title to the property. It’s a fantastic way for parents to lend a hand without the need to part with a lump sum of cash.

In 2023, the ‘Bank of Mum and Dad’ supported a staggering 47% of home purchases by under 55s. With house prices soaring and mortgage affordability tightening, JBSP mortgages have seen a surge in popularity, offering a larger mortgage based on the combined income of all parties, without the need for a hefty deposit.

But what’s in it for you? Besides helping your loved ones, JBSP mortgages can protect your assets in case of a relationship breakdown, and they don’t trigger additional stamp duty or capital gains tax if you already own a property. It’s a win-win!

Of course, every silver lining has a cloud, and JBSP mortgages are no exception. If the homeowner struggles with repayments, the co-borrowers must step in, which could affect their credit rating and borrowing potential. It’s essential to consider these risks and seek independent legal advice before diving in.

JBSP mortgages aren’t just for first-time buyers; they can be a short to medium-term boost for anyone looking to secure a home. And while there are age restrictions and considerations for future borrowing, with the right planning, a JBSP mortgage can be a stepping stone to financial independence for your child.

Remember, it’s always wise to consider income protection and life insurance to safeguard your family’s future. With a JBSP mortgage, you’re not just providing a temporary leg-up; you’re setting the stage for long-term success.

Published on 2nd August 2024

The information contained within was correct at the time of publication but is subject to change.