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The private bank of Mum and Dad



With a third of first-time buyers needing family support to buy their first home, the bank of Mum and Dad has become a reality for many.

3 min read

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Homeowners are getting older

For the last 15 years, not only has home ownership in the UK been in decline, but the average age of homeowners has been rising.

According to the government’s 2016-2017 English Housing Survey, the proportion of households living in homes they own stood at 63%, well down on the peak of 71% in 2003. At the same time, the proportion of 35-44 year olds living in their own home has fallen to 52%. This compares to 72% in the 2006-07 survey, a 20% fall in 10 years. In parallel, the proportion of private sector renters in the same age group has increased by 18% to 29%, suggesting that the demographics of home owners and renters have changed.

Survey reference date changed in 2008-09 survey

According to Nationwide, UK property prices have risen by 79% in the last 15 years, while average earnings have risen by about 50%, according to earnings data from the Office of National Statistics. As a consequence, people who aspire to own a property now need to spend longer than before renting or living at home to save for a deposit.

Getting a hand-up for the first rung of the property ladder

However, there is an alternative to saving for longer – getting a hand from the bank of Mum and Dad. Over a third of first time buyers in England now benefit from financial help from family. Those receiving family money are able to buy their first home about 2.6 years earlier (4.6 years earlier in London) than those without.

According to the Social Mobility Commission, over 30% of UK households with dependent children hold assets that could be used towards a deposit for the purchase of a home. This could lead to an increase in the number of first time buyers turning to help from their family. The Social Mobility Commission’s research suggests this could rise to nearly 40% by 2039/40.

Parental support can take many forms – gifting the initial deposit, using an inheritance to pay down the children’s first mortgage, or acting as co-guarantors in the property purchase. In the latter case, co-guarantors need to accept that they may be expected to provide support if the borrower defaults on their mortgage and will generally have restricted access to the money used to support their children’s mortgage.

“UK First time buyers receiving help from family save on average 2.6 years compared to those without.”

Keep it in the family with Adam

For some, helping a relative get onto the property ladder is a way to pass on the family wealth through the next generation. Adam has been supporting families across generations and the latest addition to the Adam mortgage range, the Offset Select mortgage, continues this tradition.

Using an Offset Select mortgage, clients who bank with Adam can help their family get on the property ladder. An offset mortgage usually allows you to reduce your mortgage payments by offsetting your deposits against the amount of your loan, reducing interest on the loan. Our article ‘Could an offset mortgage be right for you?’ explains how this works.

The Adam Offset Select Mortgage lets account holders offset a family member’s loan amount against their own deposits. Unlike a guarantor mortgage, it doesn’t tie up family members’ funds and they can use their money whenever they like. Nor does it make them liable to the borrower’s debt – their offset deposits will remain in their name.

And for even greater flexibility, funds held in the three major currencies – sterling, euros and US dollars – can be used to offset a family member’s mortgage.

Those with large families may want to help several family members at once. A supporting parent could therefore use any excess deposits to support several children at the same time using more than one segregated offset deposit account in their name.
Additionally, the borrower can receive support from multiple family members, as up to 10 offset deposit accounts can be tied to a single mortgage.

This means that clients with large amounts on deposit can put that money to work for their family without putting it at risk or out of reach. We’ve just made the bank of Mum and Dad easier than ever to use for our clients.

Could an offset mortgage be right for you?

An offset mortgage allows you to deduct – or offset – your deposits against your mortgage balance for the purpose of calculating interest....

Read the full article 

Find out how you can help your family on to the property ladder

Use our online mortgage calculator to find out what the impact of using your savings towards an Offset Select Mortgage would be, as well as how much you could borrow and at what cost.

Full details of our range of mortgages can be found here. If you would like to find out more, discuss your requirements with one of our expert mortgage advisers, or have any questions, please contact your private banker or Adam 24 on 0131 278 3777.

This product may not be suitable where:

  • Offset Deposit account holders may need access to their funds to an extent that could significantly diminish the benefits of the product or don’t have any deposits to offset for the duration of the borrowing
  • The mortgage borrower wants to use the mortgage for multiple purposes, for example where the mortgage requires both interest-only and repayment elements.

Please note the mortgage borrower may not be able to access their Offset deposits should they fail to repay their mortgage.

It’s important that you understand the risks related to using foreign currency deposits against your Offset Select mortgage:

  • Negative interest rates may apply to deposits based in euros 
  • The value of foreign currency Offset deposits could fall in relation to the sterling mortgage balance if foreign exchange rates change, substantially reducing the mortgage savings

Your home or property may be repossessed if you do not keep up repayments on your mortgage.

For mortgage amounts over £750,000. Over 18s only. Terms and conditions apply. You may not be eligible for all Adam mortgage solutions.



Rising property prices mean that it is harder than ever to get on the property ladder. Getting help from parents can mean knocking years off the time it takes to save for a first property. One way parents can help is by using a family offset deposit account to reduce the cost of their children’s mortgage.

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Our advisors will get to know your goals before suggesting solutions and can arrange credit secured against most asset types, whether you need a mortgage, personal loan or want to borrow against an investment portfolio.