The Intermediary – March 2025 - Flipbook - Page 46
RESIDENTIAL
Opinion
Integrated approach
to homeownership
A
ffordability
challenges and
societal changes,
mean that the
homebuyer market
is very different
compared with what it was a
generation ago.
Back then, people typically only
took out a mortgage with their spouse
or partner, while first-time buyers
were largely younger couples or single
professionals, both of whom would
move up the property ladder as their
careers progressed and families grew.
The situation is different now.
Spiralling house prices, stricter
affordability tests, and a cost-of-living
crisis mean buyers are looking at more
creative solutions to get on or move
up the housing ladder, which may
involve pooling resources with family,
friends, or business partners.
The mortgage market is evolving to
facilitate this, and Hinckley & Rugby
has been leading the way by offering a
flexible Core mortgage range, which
can be adapted to suit the needs of a
diverse range of buyers.
One of the most significant
shis has been the rise of multigenerational mortgages. There has
been a significant increase in the
number of parents and grandparents
helping younger first-time
buyers. This may be by
giing funds for
a deposit
or
through mortgage products like Joint
Borrower Sole Proprietor (JBSP) loans.
These loans can enable younger
buyers to borrow more and access
more affordable mortgage deals.
They also ensure the parents’ or
grandparents’ names aren’t on the
property deeds, so the purchase
doesn’t aract higher second-home
Stamp Duty charges.
This is one common use of JBSP
mortgages, but it is not the only one.
At Hinckley & Rugby, we have also
seen these mortgages used by middleaged professionals to support older
parents looking to remortgage.
This is supported by our Tailored
Term feature, offered across our Core
range products. This allows multiple
applicants to share mortgage costs
over different timeframes – ideal
when there is a significant age gap.
For brokers, this enables them to
tailor products to the needs of their
clients, regardless of whether it’s the
parents or the grown-up children
who are the joint borrowers, without
needing to access specific specialist
standalone products.
But these aren’t the only uses for
JBSP lending facilities in today’s
market. They can also be a useful
mortgage tool for couples following
a divorce, where one party who may
no longer live in the family residence
continues to be a named borrower
on the mortgage to help with
affordability calculations.
This can avoid the upheaval
of downsizing into a smaller
property, which may be a key
consideration, particularly if
children are involved.
It takes a village
With rental costs at an all-time
high, we are also seeing an increasing
number of mortgage applications
from friends looking to buy a property
together. These arrangements can
allow those with different earnings
potential to pool resources, escape the
46
The Intermediary | March 2025
LAURA SNEDDON
is head of mortgage sales
at Hinckley & Rugby for
Intermediaries
There has been a
significant increase in the
number of parents and
grandparents helping
younger first-time
buyers[...]by gifting funds
for a deposit or through
mortgage products”
rental trap, and start building equity.
Similarly, we have also arranged
mortgages for siblings buying together
and for business partners looking to
invest in property.
Bringing JBSP into our core
mortgage range and offering a tailored
term as standard is designed to
simplify things for brokers.
This means fewer silos, creating a
more streamlined process for brokers
to match borrowers with the right
solutions, whether they are first-time
buyers seeking additional help to get
on the housing ladder, or borrowers
who need a more innovative and
flexible lending solution.
Hinckley & Rugby has been helping
would-be buyers get the keys to their
dream home for 160 years.
Evolving our core mortgage range
will ensure we continue to offer
suitable lending options to the next
generation of homeowners. ●
