1. Does it have to be a member of the family who helps?
Anyone who wants to help out by opening and saving in a Lend a Hand Savings Account, can do so whether this is a parent, grandparent, aunt, uncle or friend.
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2. What’s the difference between this and an offset mortgage?
With an offset mortgage the savings element is treated as though it’s reduced the mortgage balance that interest is charged on – so less interest is charged on the mortgage, but no interest is paid on the savings. With Lend a Hand however, the savings element receives interest whilst also allowing the borrower to benefit from a lower fixed-rate.
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3. What’s the difference between this and having a guarantor?
A guarantor guarantees 100% of the mortgage and ‘promises’ to pay the mortgage each month if things go wrong. With Lend a Hand the savings element acts as a guarantee until the mortgage has reduced below a certain point relative to the property’s value, but at the same time it allows the borrower to benefit from a lower interest rate. It also means that the Helpers aren’t liable for the borrower’s obligations to pay the mortgage in the same way as a guarantor. However, if the borrower defaults on the mortgage then we’d be entitled to take money from the Lend a Hand Savings Account.
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4. Can I borrow more money to increase my Lend a Hand mortgage?
No, you can’t borrow any more money while you have the Lend a Hand mortgage.
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5. Can I choose a new fixed-rate mortgage deal at the end of the three years?
You can choose one of our mortgages that are available at the end of the fixed-rate deal. You would need to choose from the range appropriate to the mortgage amount as a percentage of the property value at that time.
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6. When can the Helpers get their money back?
After the end of the 42-month fixed-rate savings period, so long as the amount of the mortgage compared to the value of the property has dropped to 90% or less of the property’s value, you and the borrower together can then ask us to release the savings. Find out more.
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7. Can the Helpers get their money back any earlier?
You can only get your savings back after the 42-month savings term and the mortgage has dropped to 90% or less of the property value. Find out more.
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8. What if the Helpers need their money in an emergency?
It’s important to note that even in an emergency the money cannot be released from the savings account. Consider whether you think you would need access to the money during the 42-month fixed term or before the loan to value on the Lend a Hand Mortgage has dropped to 90% or less of the property’s value. Find out more.
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9. How will we know if the mortgage has dropped to 90% or less?
When you ask for the savings to be released, both you as the borrower and your Helpers need to ask together. We may then carry out a valuation of the property to establish whether the mortgage has fallen to 90% or less of what the property’s worth. There’s no charge for the first valuation but any subsequent valuation will be charged to the person requesting the valuation at our standard valuation fee at that time. See our valuation fees.
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10. What happens if house prices fall?
If the mortgage does not drop to 90% or less of the property’s value, then the charge on the savings will stay in place.
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