Best guarantor mortgage deals

What is a guarantor mortgage?

A guarantor mortgage is when someone else (the guarantor) agrees to step in and cover your repayments if you ever miss them.

This extra security helps you borrow more or get a mortgage with a smaller deposit - even if your income or credit history wouldn’t normally be enough.

The guarantor doesn’t co-own the property, but they are legally responsible for making repayments if you fall behind. Because of this, they need to be financially stable and usually a homeowner themselves.

Why choose a guarantor mortgage?

Guarantor mortgages can be a big help if:

• You’re a first-time buyer with little or no deposit
• Your income isn’t high enough to borrow what you need
• Your credit history isn’t perfect
• You want to buy a property sooner than you could on your own

Having a guarantor can make the difference between being told “no” and getting your mortgage approved.

How guarantor mortgages work

There are a few different ways a guarantor mortgage can be set up, depending on the lender:

Some use the guarantor’s savings as security. The money is locked away in a special account for a few years.

Others use the guarantor’s home or property equity as a guarantee instead.

In both cases, the idea is that the lender has something to fall back on if the borrower can’t keep up with repayments.

Once you've built up enough equity in your home or made regular payments for a few years, the guarantor can usually be removed, though this depends on your lender’s rules.

Who can be a guarantor?

Most lenders will only accept close family members as guarantors, usually parents, but sometimes grandparents or siblings too.

To be a guarantor, you’ll usually need to:

• Own a home in the UK
• Have a strong credit history
• Be able to afford the risk of covering the borrower’s payments
• Show proof of income and financial stability

It’s a serious commitment, so guarantors should take independent legal advice before signing anything.

Who can get a guarantor mortgage?

Guarantor mortgages are mainly aimed at first-time buyers or younger borrowers who need a little help getting started.

To apply, you’ll need to show that you can afford the monthly repayments with the guarantor acting as a safety net. Lenders will also look at:

• Your income and outgoings
• Your credit history
• The size of your deposit (if you have one)
• Your guarantor’s financial position

Our expert advisers can help check whether this is the right type of mortgage for you and your guarantor.

How to find the best guarantor mortgage deals

Guarantor mortgages aren’t offered by every lender, so it’s worth comparing deals carefully.

You can use our Mortgage Finder to check the latest guarantor mortgage rates and see which ones you’re eligible for.

We work with over 90 lenders and can help you find a deal that suits both you and your guarantor.

Our advisers will explain the risks clearly, answer any questions, and guide you through every step of the application.

Making repayments on a guarantor mortgage

You’re still the one making the monthly payments, even with a guarantor mortgage.

The guarantor only steps in if you fall behind. If that happens and they can’t cover the payments, their savings or property might be at risk - so it’s important to keep up with your repayments.

Some lenders offer a review after a few years. If your finances have improved and you’ve built up some equity, you may be able to move to a standard mortgage and release the guarantor.