Family Springboard Mortgage
She wants to buy her own home.
He wants to help – without spending his savings. Now they can do both.
- Homebuyer takes out Family Springboard Mortgage
- Helper (family member) opens a Helpful Start Account 3 linked to that mortgage and puts 10% of the purchase price into that account for 3 years 2
- Homebuyer then only requires a minimum 5% deposit
Your home may be repossessed if you do not keep up repayments on your mortgage
Introducing the Family Springboard Mortgage
The average age of an unassisted first-time buyer is now 35, with family members playing a large role in helping those younger than this get on the property ladder.
Having listened to the problems faced by first-time buyers, we’ve created the Family Springboard Mortgage, which lets relatives use their savings to help them buy a home.
How it works
- The homebuyer takes out a Family Springboard Mortgage, while their helper opens a Helpful Start Account linked to that mortgage
- The helper then puts 10% of the purchase price into the Helpful Start Account
- This means we can offer the homebuyer a 95% mortgage, with them only requiring a 5% deposit
- After 3 years, the helper gets their money back with interest, provided that repayments are kept up to date on the mortgage
See the table for our current springboard mortgages
|Product||Initial interest rate||Follow-on interest rate||The overall cost for comparison is||Application fee||How much could I borrow?||Early repayment charge|
|3 Year Stepped Fixed Rate - Purchase Only||
2.99% fixed until 30 June '16, then 2.79% until 30 June '17, then 2.59% fixed until 30 June '18
2.99% (BBBR + 2.49%)*
variable for the remaining term *
|£0||95% of the value of your home. Maximum Loan £500,000||
30 June '18
How the Joneses helped their son get on the property ladder
David graduated 2 years ago, has been working ever since and moved back in with his parents post-university so he could save up to buy his own place.
He had his eye on a 1-bedroom flat, and managed to get together a 5% deposit. His mum and dad were willing to provide financial assistance to help him become independent.
That's when they discovered the Family Springboard Mortgage. After seeking Independent Legal Advice 4, they realised that if mum and dad put 10% of the purchase price in a Helpful Start Account, David would be able to put down his saved 5% as a deposit against a 95% Family Springboard Mortgage.
So David will soon be able to complete on his dream home and mum and dad can start thinking about what to do with their money when they get their 10% back, with interest.
This case study is a fictional example to show how the Family Springboard Mortgage works.
Can I take out more than one Family Springboard Mortgage?
The Family Springboard Mortgage is specifically designed to help buyers get on or up the property ladder, so you can only take out one.
How long is the mortgage term?
The term can be anywhere up to a maximum of 25 years.
Can I take out a further advance with my Family Springboard Mortgage?
You can’t borrow more on top of your Family Springboard Mortgage for the period of time the Helpful Start Account is opened alongside it.
Can I opt for a NewBuy home with a Family Springboard Mortgage?
The government’s NewBuy scheme allows people to buy a new-build home in England without the need for a large deposit. The Family Springboard Mortgage is not available on this scheme.
What rate will I pay on my Family Springboard Mortgage?
The Family Springboard Mortgage offers our 3-year fixed rate
What happens to my Family Springboard Mortgage after the 3 year fixed period?
If all your payments to your mortgage account have been maintained after 3 years, we will close the Helpful Start Account closes down and release the funds back to your helpers. We may however extend the period to release the funds if payments have not been maintained on the Family Springboard Mortgage. After the fixed rate ends, the Family Springboard Mortgage will revert to a Lifetime Tracker Mortgage.
Can I help more than one member of my family?
Yes, you simply have to set up a separate Helpful Start Account for each Family Springboard Mortgage.
Am I guaranteeing the Family Springboard Mortgage?
No, a guarantor would guarantee 100% of the mortgage rather than helping out on the deposit, as you’re doing. So you won’t be responsible for maintaining the repayments.
Are there any circumstances in which some or all of my funds will be retained by the bank?
This can happen if the property is repossessed and sold, and there’s a shortfall between the sale price and the amount of the mortgage. We may, however, retain funds in the Helpful Start account in the event of missed payments on the mortgage account. You should also be aware that under the terms of the FSCS any funds held as security against the mortgage are not covered by this guarantee if the bank is unable to meet its financial commitments.
Are the funds in my Helpful Start Account covered by the Financial Services Compensation Scheme?
No. Your Deposit in the Helpful Start Account will be not be covered by the FSCS for the duration of the charge and your money may be at risk if the bank is unable to meet its financial obligations. For further information about the compensation provided by the FSCS (including the amounts covered and eligibility to claim), please ask at your local branch, refer to the FSCS website www.fscs.org.uk or call the FSCS on 020 7741 4100 or 0800 678 1100. Please note only compensation related queries should be directed to the FSCS.
Do I have any rights over the property?
As a helper, you have no rights over the property.
Why do I need legal advice?
You will need to seek Independent Legal Advice to ensure you understand your responsibilities and commitments clearly before opening a Helpful Start Account. The legal charge will be over the duration of the deposit for a minimum of 3 years.
Can I use an existing offset arrangement with Helpful Start Account?
Yes, the account can be included as part of an existing offset arrangement. In this case, the funds will serve 2 functions for the helper – reducing the interest payable on an offset mortgage and providing the security for the Family Springboard Mortgage. There will be no interest payable on the Helpful Start Account in this case, but it will reduce the interest accruing on the mortgage as part of the offset arrangement.
What if I want to draw money from my Helpful Start Account in an emergency?
Please note that any funds put into your Helpful Start Account will be unavailable until the end of the 3-year term, except in exceptional circumstances.
You can download our tariff of charges for our mortgage range here.
Alternatively, you can get our tariff of charges in Braille, large print or audio tape/CD by calling 0800 400 100 5 (via Text Direct if appropriate).
- Once you've established how much you can afford and discussed your plans with your helper, you can start your application for a Family Springboard Mortgage by calling 0800 197 1081 1 to book an appointment with a Mortgage Adviser
- We'll let you know on the phone what you need to apply
- You don’t need to apply for your mortgage at the same time your helper applies for their Helpful Start Account, but both applications must be received in order for the mortgage to progress
- To get started, you'll find some information in the Helper FAQs above on how the account works and what happens to your money in the event of missed payments
- Call 0845 070 5090 1 to discuss opening your Helpful Start Account and ask any further questions
- As part of the application you'll need to tell us which solicitor you're getting Independent Legal Advice 4 (ILA) from (see below)
- You don't need to apply for your savings account at the same time the homebuyer applies for their mortgage, but both applications must be received in order for the mortgage to progress
Independent Legal Advice
As part of the application, you’ll need to tell us which solicitor you’re getting Independent Legal Advice 4 (ILA) from. This cannot be the same solicitor who is conducting the conveyancing on the mortgage, but can be someone from the same firm. ILA will make you aware of the implications and risks associated with taking a Helpful Start Account as part of the Family Springboard Mortgage. Fees will apply.
Looking for a different type of mortgage?
- Use your savings to help reduce your mortgage payments
Tracker mortgage - If you want a mortgage that tracks Barclays Bank Base Rate
Buy to Let mortgage - Choose the right mortgage for your rental property
1. Lines are open Monday to Friday 8am-9pm, Saturday 9am-8pm and Sunday 10am-4pm. To maintain a quality service, we may monitor or record phone calls. Read our call charges and information .
2. After 3 years, funds are released as long as the Family Springboard Mortgage payments are kept up to date.
3. The money deposited in the Helpful Start Account will be used in the event of a default of the mortgage and to clear any financial loss if repossession is necessary.
4. Independent Legal Advice is where a solicitor (but not the solicitor involved in the conveyancing of the mortgage) ensures that the family members have the implications and risks associated with taking the Helpful Start mortgage explained to them. The solicitors will also ensure that you complete paperwork from Barclays to enable the Family Springboard Mortgage to complete. Fees will apply.
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* BBBR = Barclays Bank Base Rate which is currently 0.50% (effective 6 March 2009).
** Subject to status and availability. Customers must be 18 years or over to apply for a mortgage.