For many families, helping a child or grandchild buy their first home feels like a natural extension of wanting them to flourish. But not every parent or grandparent can or wants to hand over a lump-sum gift.
The good news? The mortgage market now offers several structured, regulated and often safer ways to support the next generation onto the property ladder without simply giving your money away.
The three most useful family mortgage options
Springboard style ‑ mortgages (or family deposit mortgages)
Support without gifting – your money is returned if the borrower pays on time.
How it works: The ‘helper’ puts cash amounting to 10% of the purchase price into a special savings account which is locked away for 5 years. Their family member can then take a mortgage of up to 100% of the property value. After 5 years, the ‘helper’ gets their money back with interest and the borrower continues on with their mortgage.
Benefits: What makes this approach appealing is that it allows families to offer meaningful support without diminishing their long-term wealth. The ‘helper’ retains ownership of their funds throughout, while the buyer benefits from improved borrowing power and the ability to enter the property market sooner than they might otherwise have been able to. The structure also avoids the emotional and financial complexity of gifting, offering a more controlled and time limited form of assistance that still provides the buyer with the boost they need to get started.
Ideal for: This type of mortgage works particularly well for families who have savings available but prefer not to part with them permanently. It suits parents or grandparents who are comfortable locking funds away for a few years, provided they will return with interest. It is also a strong option when the buyer is financially responsible but simply needs an initial affordability lift to secure their first home. For households that value structure, security and clear timelines, a Springboard style mortgage can offer a helpful middle ground between gifting money and standing back entirely.
Joint Borrower, Sole Proprietor (JBSP)
Support their affordability without owning the home.
How it works: A JBSP arrangement allows a parent or grandparent to help a family member buy a home without becoming a legal owner of the property. In this setup, the ‘helper’ goes onto the mortgage application alongside the buyer, and their income is included as part of the affordability assessment. This can significantly increase the amount a first-time buyer is able to borrow, especially if their own income is still developing or their affordability is limited by other commitments. Unlike a traditional joint purchase, however, the ‘helper’ is not added to the property deeds, meaning they have no legal ownership of the home itself.
Benefits: One of the major advantages of this structure is that it preserves the first-time buyer’s ability to benefit from any stamp duty relief they may be entitled to, because the ‘helper’ is not listed on the title. If the ‘helper’ already owns one or more properties, they also avoid triggering the higher rate of Stamp Duty Land Tax that normally applies to additional property purchases. This makes JBSP a tax-efficient form of support, allowing the family to strengthen the borrower’s position without inadvertently creating extra costs or undermining the buyer’s first-time buyer status.
Ideal for: A JBSP arrangement is ideal for families who want to help a buyer borrow more without gifting money or tying up savings. It suits buyers who need a temporary boost to affordability to get onto the property ladder such as early career professionals, freelancers or those returning to work after a break. Overall, it’s a flexible way to provide support while keeping ownership firmly in the buyer’s hands.
Family guarantees (property or savings backed‑)
Offer security instead of cash.
How it works: Family guarantee arrangements allow a parent or grandparent to support a home purchase by using the equity in their own property as security for the buyer’s mortgage. Rather than contributing cash upfront, the ‘helper’ provides what’s known as a ‘collateral charge’ over a portion of the equity in their home. Typically, this must amount to at least 20% of the value of the property being purchased. This equity effectively acts as the deposit, enabling the first-time buyer to take out a mortgage for the remainder of the purchase price. The ‘helper’ does not need to hand over money, instead they are simply offering their equity as reassurance to the lender that the loan is safe.
Benefits: The major benefit of this approach is that it removes the need for liquid savings. For many families, particularly those with a valuable home it provides a practical route to offer substantial support without affecting their day-to-day finances. It can make a significant difference to a buyer who has a reliable income but struggles to save a large deposit – whether that’s due to rent, childcare costs or the general difficulty of accumulating savings in high cost areas as a first-time buyer. The arrangement gives the buyer a stronger starting point, often allowing them to secure better mortgage terms or access properties that would otherwise be out of reach.
Ideal for: Those who want to help a family member who’s struggling to save a deposit or meet affordability but don’t have large cash reserves. By using equity in the ‘helper’s’ home as security, it provides the support needed without requiring cash up front. For many, it strikes the right balance between offering meaningful support and maintaining control over their own financial resources, all while keeping ownership of the new property entirely in the buyer’s hands.
Choosing the right type of support can make a real difference to a first time buyer’s journey, and the best approach will always depend on your family’s circumstances. To understand what will work most effectively for you, it’s worth speaking to a mortgage adviser about which family support route fits your situation.
If you would like to discuss your plans to give mortgage assistance to your descendants, please do get in touch.
Please note
The information contained within this document is subject to the UK regulatory regime and is therefore primarily targeted at consumers based in the UK.
This article is distributed for educational purposes only and should not be considered financial advice. If you are unsure about the suitability of otherwise of any product or service, we recommend that you seek professional advice.
The opinions stated in this article are those of the author and do not necessarily represent the view of Progeny and should not be relied upon to make a financial decision.
Information contained herein has been obtained from sources believed to be reliable but is not guaranteed.
