What is a guarantor mortgage?
A guarantor mortgage involves a family member (usually a parent) agreeing to cover your mortgage payments if you can't. The guarantor doesn't own a share of the property but takes on legal responsibility for the debt.
Guarantor mortgages can help borrowers who have a low credit score, limited deposit, or income that's borderline for the amount they need to borrow. By adding a guarantor's financial strength to the application, lenders are more willing to lend.
Types of guarantor mortgage
There are several variations of guarantor mortgage in the UK:
- Savings-based guarantor: The guarantor deposits savings (typically 10–20% of the property value) into an account linked to the mortgage. The savings are returned after a set period (usually 3–5 years) if all payments are met
- Property-based guarantor: The guarantor uses their own property as additional security against the mortgage
- Joint Borrower Sole Proprietor (JBSP): Up to four people on the mortgage but only one on the property deeds — avoids stamp duty surcharges for the helpers
- Family springboard: Specific products (like Barclays Family Springboard) where family savings earn interest while acting as security
💡 JBSP mortgages are often the best option because the helpers' income boosts affordability without them being named on the property deed, avoiding second property stamp duty charges.
Risks for the guarantor
Being a guarantor is a significant financial commitment. The main risks include:
- If the borrower can't pay, the guarantor must cover the mortgage payments
- The guarantor's own ability to borrow may be reduced (the guarantee counts as a financial commitment)
- If property-based security is used, the guarantor's home could be at risk
- The guarantee may affect the guarantor's credit score if payments are missed
Eligibility requirements
To be a guarantor, you typically need to be a homeowner (for property-based guarantees), have a good credit history, and have sufficient income or savings to cover the mortgage payments if needed.
Most lenders require the guarantor to be a close family member — usually a parent. Some accept siblings, grandparents, or other relatives, but friends are generally not accepted.
⚠️ Guarantors should always take independent legal advice before signing. This isn't just a formality — they need to fully understand the financial risk they're taking on.
Alternatives to guarantor mortgages
If a full guarantee feels too risky, consider these alternatives:
- Gifted deposit: Family gifts the deposit money instead of acting as guarantor
- Family offset mortgage: Family savings are linked to the mortgage to reduce interest, without being at risk
- Shared ownership: Buy a 25–75% share of a property, reducing the mortgage needed
- Right to Buy: Significant discount on council property purchases
Find the right guarantor mortgage
Not all lenders offer guarantor mortgages, and the terms vary significantly between those that do. A mortgage broker can compare options across the whole market and find the most suitable arrangement for both you and your guarantor.
Nesto matches you with specialist mortgage brokers who can advise on guarantor and family-assisted mortgages. Get matched for free today.