Cordelia looking around one of the many houses she's been trying to get hold ofCordelia Clark's first home felt within reach. The 27-year-old was about to scramble on to the housing ladder, but then a twist appeared.There's now a tighter limit on how much your family can help you when you're getting your deposit together. The bank of mum and dad - as it's often known.Cordelia has been looking around Scarborough for the last year and has a decent income for the area.
Now, to get a mortgage with a 10% deposit, the buyer must prove that they saved 75% of that deposit themselves.Throughout the pandemic multiple housing indexes show that the amount of first-time buyers, as a proportion of the market, has been falling. Nationwide have told Newsbeat that the decision to stop the bank of mum and dad helping people get their first home is hopefully just a temporary one.
"However, as one of the first lenders to return to 90% LTV lending in what remains an uncertain market, we have needed to be cautious to protect borrowers and ourselves."
Bank of Mum & Dad - The Powell Family via YouTube
What is the bank of mum and dad? Never heard of her
So All the rent I’ve paid to my parents over the year and they have put a side to give back to me for when i buy a house. What happens? It was mine, i paid it as principle so i was used to paying but my parents put it aside. Hmmmm
Anyone wanting a mortgage is just going to go elsewhere 😂 Nationwide shooting themselves in the foot where we live in an economy that makes it so hard to get a mortgage, as shown by the millions of people who have to pay more renting and can never afford to get that deposit.
So what’s the difference in your parents helping you out and the government giving you an extra £3k with help to buy?
Ah, another way to stitch up the young people that are already spending as much a month on rent as they would be a mortgage, proving they can afford it, but without having enough left over each month to be able to save.
There are some pretty privileged kids on here that are expecting help from parents and see it as the norm. Howsabout all you richies stop buying-to-let and buying overpriced houses with mummy&daddies cash, then maybe the market will correct and we can ALL afford to own a home?!?
I’ve got a house deposit but probably won’t get a mortgage approved as my salary in London as a single household is too low 😭. Even though at current I pay more in monthly rent than I would if I had a mortgage.
Bank of Mum and Dad was never available to the vast majority of people. Something the out of touch BBC establishment will never or refuse to understand.
What the fuck has that got to do with anyone else
I'd suggest everyone boycotts AskNationwide then. Someone should start a campaign on social media requesting all first time buyers to steer clear of using their financial services and ask their parents, family and friends to do likewise. Give it a month and they'll reverse it.
The bank of mum & dad? 😂😂😂😂😂
Oh good because my mum and dad had no money to keep in the bank.
Stupid move from NW. They are losing interest from potential customers so not able to pay savers interest on their savings. This benefits nobody in the end. How are future generations ever going to be able to own a home?
All these poor crying privileged lefties up in arms now 😂😂
The bigger the deposit, the lesser to pay!!!
The fact a lot of people pay quite high rent every month should go along way to prove you can pay a mortgage every month...
We have paid our private rent for 7 years, on time, every, single, time. A mortgage for our home would be less than our current rent but we can't spare the cash to save for a deposit. Father in law offered to loan it from husbands inheritance but won't be allowed now 😔
Deadbeats
this is the end of most if not all first time buyers to be honest, unless you are fortunate enough to be able to afford extoritionate rent and save up 10 grand
Tail wagging dog - if they can do without the business then that’s up to them, bit of a bizarre business model though; plenty of other lenders. Good luck kids - don’t let them steal your dreams
We’ve given both of ours a deposit from their Grandad’s inheritance - my son can pay a mortgage but it would take him so long to be able to save the deposit - you’re constantly chasing housing price increases it’s almost impossible 😢😡
Finally!!! 😰
always find it interesting how they have to assess if renters can afford a mortgage. 'so you currently pay £800 rent per month, your mortgage payments will be 450 per month for the next 50 years (made up numbers) are you sure you will be able to afford this?'
The Nationwide seem to have a policy of making the most from the current situation. My daughter is being forced to pay £7+k due to their opportunistic approach !!
Most Moms and Dads worried their kids might get stung if interest rates returned to normal. We now have moms and dads who've never known interest rates above 0.75%.
You don't know bbc
Banks legally can lend 10 times what they have in reserve. In other words they don't actually have any money.
So just give your children the money other ways, im sure a good accountant could swing this problem
God I'm so screwed. It's alright if your in the North, but if your down South and don't ideally want to relocate 300 miles away, our generation is absaloutely screwed. A small 2 bed terrace without a drive or garden is over £350,000 locally to me.
Seems like a bit dick move from nationwide.
Vote with your feet & go elsewhere for a mortgage. The Nationwide will soon change their attitude once they realise they’re not making enough profit.
I put down a big enough deposit to get a mortgage but my dad wanted to add to it as he'd always said he would. Under these rules I'd have had to reject his offer and borrow more money at a higher interest rate to... prove I could afford a mortgage? I just don't see who this helps
Some are small children of just forty years, have mercy.
Nationwide(from the story) have always been finiky leaders, 20 years ago they mucked me around, 50 years ago they mucked my parents around. Try natwest a lot better.
First time buyers : the end of first time buyers
They’ve a bank!?!?
Here's how modern-day slavery works. You will pay a banker with 20,000 hours of labour, for a house that took 2,000 hours of labour to create. Homeless people are your inspiration for doing so - enjoy the ride, you're free, and others, so I'm told, are jealous of your freedoms.
What on earth has it got to do with lender. They have their 90% Mum & Dad have no interest Nationwide AskNationwide dictating toparents what they do bad PR will be avoiding them
As insurance and loans are normally based on credit and risk Nationwide must have had a lot of people who 'borrowed' their deposit, end up defaulting on payment, its not unfair its business!
Slightly disingenuous tweet I think. According to article NW have increased LTV from 85% to 90% for FTB - but with proviso that FTB shows they have managed to save most of deposit themselves. Can still get 85% LTV w/o that condition. So arguably a +ve move rather than -ve?
Disagree with this, the ability to pay the mortgage should be the main thing. I’ve got friends who pay more in rent than a mortgage would cost on similar property. But struggle to save due to high rental costs.
As long as the money is legal, and the person isn't borrowing from elsewhere, credit card etc, to fund the deposit, what does it matter who gives them the money? Things are tough for young buyers trying to get on the ladder. Why make it even harder?
BBC still pushing for a real estate economy refuses to look at credible alternatives in its propaganda for 10DowningStreet
Prices of similar houses in the South East of England are at least double which makes it even harder for people to get their first property. Rents are crazy too.
Good..seems to me that the bank of mum & dad has only helped fuel the rise in house prices and taken homeownership out of reach of those who don’t have parents who can release equity due to the rise in house prices...
Wut
A Nationwide spokesman said: 'This as a temporary measure which will remain under frequent review and fully gifted deposits are accepted on lending up to 85%. So basically give your savings to your parents and have them' gift' it back +extras in one lump sum. Or am I wrong?
Everything you want from a bank right now comes with them requiring a guarantee or collateral from someone. It's like they're fearing an economic catastrophe for some unknown reason. Right now FTB need not apply.
Dear god what happened to your own money and being able to do what you want with said money! I’ve never heard anything so dictatorial in all my days!!!
who's bloody business is it how they got the money bloody cheek
This will only hurt the lenders more. Put more restrictions on mortgage offers and less people will be able to apply for mortgages.
From a logical perspective it makes sense because a person who's practiced good financial management by saving money themself might be more likely to stick to the mortgage payments. Also as a matter of principle it levels the playing field for those with that parents can't help!
this doesn't even make any sense, why would they want to do this
Been spendin most our lives, living in a landlord's paradise...
Everything was pretty fkd before but COVID had shone a light on just how bad things are.
As living standards fall & ‘small house hold’ wealth is declining, it probably is. Give it 50 years Britain will be a further shadow of what it has now become, being a place only for the very wealthy to have any form of life/life style. The decline in Britain has been meteoric.
How will they know? If my mom transfers me 20k for a deposit and I just say I have 20k for a deposit to the lender then they never have to know. Obviously whatever mortgage offer they approve they assume against their calculation risk that you can afford the payments. Silly.
‘Bank of mum & dad’ sounds like something someone who bought their first home for 50k 30 years ago would say
Parents should be allowed to help out! As an indidividual they assess your income and make you a mortgage offer, you may need extra on top of your savings to help out. Why should the banks take issue with that? My parents helped me to get on the ladder.
Hopefully. It's time this unsustainable housing market was squashed.
One more pillar that supports ridiculous house prices being chipped away.
Hi, Thanks, I Provide High Quality Website Profile Backlinks Service at Affordable rates. I Will Give You High Quality (DA 60-100) Profile Backlinks. Please Click Here:
United Kingdom Latest News, United Kingdom Headlines
Similar News:You can also read news stories similar to this one that we have collected from other news sources.
Source: The Independent - 🏆 80. / 59 Read more »
Source: OK_Magazine - 🏆 12. / 84 Read more »
Source: The Independent - 🏆 80. / 59 Read more »
Source: TheSun - 🏆 64. / 61 Read more »
Source: Lifestyle - 🏆 131. / 51 Read more »
Source: The Mirror - 🏆 136. / 51 Read more »