A guide to guarantor mortgages
Guarantor mortgages help people who can’t quite meet lender requirements on their own by bringing a family member into the equation. The guarantor provides additional security, either through their income, savings, or property, allowing the borrower to access a mortgage they wouldn’t otherwise qualify for. This guide explains how these arrangements work and what to consider.
In this guide
What is a guarantor mortgage?
A guarantor mortgage is a home loan where a third party — typically a parent, grandparent, or close family member — agrees to cover the mortgage payments if the borrower cannot. The guarantor provides additional security to the lender, which reduces the risk and allows the borrower to access a mortgage they might not qualify for independently.
The guarantor does not usually appear on the property deeds, meaning they have no ownership stake in the home — unlike a joint mortgage, where all parties share ownership. Their role is purely financial: they are providing a guarantee that the mortgage will be repaid. The borrower is the sole owner and is primarily responsible for making the monthly payments.
Different lenders structure guarantor mortgages in different ways. Some require the guarantor to use their own property as security, others require them to deposit savings with the lender, and some use the guarantor’s income to boost affordability calculations. Our borrowing calculator can give you an initial estimate of how much you could borrow with a guarantor.
Types of guarantor mortgage
Income-based guarantor mortgages use the guarantor’s income alongside the borrower’s to pass affordability checks. This allows the borrower to borrow more than they could on their own. The guarantor’s income is assessed just like the borrower’s, including their own existing commitments.
Savings-based guarantor mortgages, sometimes called family springboard mortgages, require the guarantor to place a sum of money (typically 10% of the property value) into a savings account with the lender. This money is held for a set period, usually three to five years, and returned with interest once the borrower has maintained payments successfully.
Property-based guarantor mortgages use the guarantor’s own property as additional security. The lender places a charge on the guarantor’s home, which means if the borrower defaults and the sale of their property doesn’t cover the debt, the lender can pursue the guarantor’s property.
Who can be a guarantor?
Most lenders require the guarantor to be a close family member, such as a parent or grandparent. Some lenders accept siblings or other relatives. Very few accept friends or unrelated parties as guarantors.
The guarantor must have a good credit history, sufficient income or assets, and typically must be a UK homeowner. Many lenders set age limits for guarantors, often requiring them to be under 70 to 75 at the end of the mortgage term. The guarantor will undergo their own credit and affordability checks as part of the application.
What happens if the borrower misses payments?
If the borrower misses mortgage payments, the lender will contact the guarantor to make up the shortfall. The guarantor is legally obligated to cover the missed payments. If neither the borrower nor the guarantor can pay, the lender may take action to repossess the borrower’s property and, in the case of property-based guarantees, the guarantor’s home as well.
This is a serious commitment. Both parties should fully understand the implications before entering into a guarantor arrangement. Independent legal advice is strongly recommended for the guarantor.
How Clearview can help with guarantor mortgages
Guarantor mortgages are a specialist area and not all lenders offer them. At Clearview Mortgage Solutions, we know which lenders offer the best guarantor products and can match you with the right one based on your circumstances.
We’ll guide both the borrower and the guarantor through the process, explain the responsibilities clearly, and make sure everyone is comfortable before proceeding. Contact us for a free, no-obligation consultation.
Related guides
More guides in our guarantor mortgage hub.
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