How it works

How First Start boosts your borrowing power

First Start is a joint mortgage that you take out together with a parent or another close family member. It takes their income into account as well as yours, counting theirs as the main income, so the amount you can borrow could be significantly increased.


How to work out how much you can borrow

  1. Deduct your parents' annual mortgage repayment from their income**.

    (For example, if they earn £28,640 and have an outstanding mortgage of £76,000, then deduct £5,320 (£76,000 x 7.00%) from £28,640 to give £23,320)

    Also deduct all other annual credit repayments from their income.

  2. Multiply the figure that's left by 4.5

    Take your parents' income after deductions and multiply it by 4.5, e.g. £23,320 x 4.5 = £104,940

  3. Add your income to this figure.

    (For example, if you earn £19,380, add this to £104,940 to give us £124,320)

  4. This figure is the maximum we will lend you - in this case, £124,320

** We work out their annual mortgage repayments by multiplying their outstanding mortgage by Bank of England Base Rate (using 5.50% as at 10/05/2007 as an example) plus 1.5% e.g. 7.00%.

Things you need to consider

Like all joint mortgages, First Start depends on a certain level of trust. That's because your parent is jointly responsible for the mortgage. You may intend to pay the mortgage but your parent could find themselves asked to pay it if, for example, you lose your job. How would that affect your relationship?

Other questions to ask yourself:

  1. Who's going to own the property? You can put the title to the property in just your name or your name and your parent's name. If you're going to be the sole owner, your parent must take independent legal advice before the mortgage can go ahead. If willing, your lawyer could give them legal advice.
  2. Will it affect your parent's tax situation? It could do. Before they go ahead, we strongly recommend they take independent financial, tax and legal advice.
  3. Are you happy to mix family and finance? Do you get on well with your folks? What if you fall out? Would this make things difficult? If your parent wanted to pull out, you'd have to meet our standard lending criteria to take on the mortgage by yourself.
  4. Can your parents really commit to this? What would happen if you were out of work for a while? Would your parents be able to afford the repayments? You may both want to consider Mortgage Payment Protection Insurance, which we'll be able to help you with.