WHAT IS GUARANTOR MORTGAGE ?
GUARANTOR MORTGAGE
Mortgaging in UK is a difficult task as there are a number of formalities and paperwork involved. Buying your dream property in the United Kingdom is not easy as it seems as a layman doesn’t have that expert knowledge with regard to Mortgage in UK. Completing the process of Mortgage in the UK is a lengthy process and requires expertise, therefore, the majority of the people who are planning to buy a property in the United Kingdom take advice from Mortgage Broker in UK.
Concept of Guarantor Mortgage
Not all property buyers get lucky to get approval for a Mortgage to buy a property in the UK as many don’t fulfil the criteria to get a mortgage. Therefore, there are certain ways which help a person receive a mortgage without any hassle. This article will talk about the concept of Guarantor Mortgage in UK which is useful for people who don’t fall into a good income group.
As we all know that the Mortgage is sanctioned only after the borrower meets certain criteria and all the paperwork is on point, there are people who complete all the qualifications of getting a Mortgage but fail to show proof of good income. For such people, Guarantor Mortgage comes into the picture.
A Guarantor Mortgage is for borrowers who cannot get a mortgage on their own and require another entity which is called a Guarantor who ensures the Mortgage lender that they will pay back the mortgage amount in case the borrower fails to repay as per the agreed terms and conditions.
Criteria for Guarantor Mortgage
For being a Guarantor, one must fulfil some basic checks of the Mortgage lender. The mortgage Guarantor should have a clean record regarding the mortgages, i.e., the Guarantor himself must have repaid the mortgage and doesn’t have any financial default. The terms are different in many cases, such that many lenders require that the Mortgage Guarantor has no payments left to repay while some lenders make sure that the Mortgage Guarantor in UK has paid the mortgage at least 50% of the complete amount.
Even if the Mortgage borrower has a low or NIL income, he/she can get the Property Mortgage sanctioned with the help of a Mortgage Guarantor. Therefore, in such cases, the rate of interest on the mortgage is generally high. The Guarantor Mortgages has a legal obligation to repay the mortgage of the borrower and it also must be noted that the Guarantor of Mortgage in UK doesn’t own any share in the property.
