Kent Reliance last week launched a ground-breaking mortgage that allows parents to pass on their interest-only mortgage to their children.The inter-generational mortgage aims to help first-time buyers get on the property market, as well as slash the amount of Inheritance Tax the children would need to pay. Kent Reliance says it is more of a change in product criteria that allows the standard interest-only mortgage to be passed down, rather than a new product. But it technically means the loan could be handed from generation to generation without a penny of the actual debt ever being repaid. The mortgage, which can also be passed on to non-family members such as friends or colleagues, has been a success in Switzerland. Mandip Ghattaora, spokeswoman for Kent Reliance, says there is no obligation for children to pay off the debt and they could instead choose to sell the property. She says: ‘The mortgage offers flexibility. We decided to do it after one of our members came to us wanting to know the options for an interest-only mortgage. This type of mortgage has been a success in Switzerland and we thought it would be a good idea. We’ve already had lots of calls about it.” Ghattaora stresses that it will constantly be reviewing cases to make sure the product is suitable for the client and falls in line with Financial Services Authority requirements. Alison Rolls, spokeswoman for Norwich and Peterborough, says that anything that helps more first-time buyers and reduces Inheritance Tax is a good thing, but it will not be rushing to do a similar product. She says: “We would never say never, but this one is a bit of a culture shock. The thought of passing your debt on to your children is unusual.” Jonathan Cornell, technical director at Hamptons Mortgages, says: “It’s good to see lenders thinking outside the box. I’m not sure how popular it will be with people, but it’s an innovative concept that could lead to greater things.”
em-financial says two of the five affiliate sponsors for its upcoming em-5 in association with Platform will be Kensington and Mortgages plc. The fifth birthday celebrations will take place on September 22 at the exclusive Thornton Manor. Each affiliate sponsor will be sponsoring one of the five sensory zones at the VIP black tie dinner […]
Abbey is relaunching its range of mortgages for first-time buyers on August 30 with a host of new products and reduced rates on some existing products.In its 90% LTV range, Abbey is offering a two-year tracker at 5.14% with no booking fee, a five-year tracker at 5.19% with no booking fee, a five-year tracker at […]
Following on from a successful first quarter, Premier Mortgage Service saw 22.8bn in applications and 16.7bn in completions in the first half of 2006.These results it says puts it in a good position to achieve its full year target of 44bn applications and 33bn of completions. PMS says it has been further encouraged in the […]
Edeus has signed up its 5,000th intermediary. It reached the mark – its target for the end of this year – just 10 days after it launched online.
By Jamie Clark, Business Development Manager We take a look at the Pensions Regulator’s latest auto enrolment compliance bulletin and the lessons that can be learned from it. With up to half a million smaller employers expected to reach their staging date during 2016, it’s likely that the Pensions Regulator (and the rest of the […]
News and expert analysis straight to your inboxSign up