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Guarantor mortgages are available for applicants that can’t afford the mortgage that they want on their own income or ones that don’t have a big enough deposit to put down. 

What is a guarantor? 

 
If the above applies to you, then you may stand a better chance of getting your application approved if you use a guarantor – someone who is willing to act as a guarantee to the lender and, if you fail to pay your mortgage, someone who will be legally responsible. 

 

How do guarantor mortgages work? 

 

When applying for a guarantor mortgage, you should be aware that the lender will look at both yours and the guarantor’s income to assess accurate affordability.  

 

For example, if a young couple were looking at purchasing a property worth £200,000, the lender would look at their joint income (for example, £30k) and the 10% deposit they have available (£20k). Considering the maximum amount that they would be able to borrow (usually 5x income amount = £150k) plus the deposit, they would still be £30k short. 

 

In this case, the guarantor’s income would be looked at to ensure that their maximum borrowing amount was greater than the difference. 

 

There can be limits put in place by lenders on the amount that the guarantor can be responsible for and it’s not uncommon for the guarantor’s property to be used as collateral.  

 

For advice on how you can use a guarantor mortgage to purchase your property, speak to one of our expert advisers who will be able to help you with the next steps.