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Different types of guarantor mortgage

Find out about the different types of Guarantor Mortgages

No impact on credit score

Pete Mugleston

Author: Pete Mugleston - Mortgage Advisor, MD

Updated: August 9, 2021

There are two main types of guarantor, whole loan guarantors and shortfall guarantors. Every lender is different in the criteria needed for mortgages with guarantors; most require the guarantor to afford the whole of the loan, with a select few just requiring the guarantor to afford the shortfall.

Whole loan guarantor: This is the most common guarantor criteria. With lenders aiming to reduce the risk involved for themselves, most require the guarantor to accept responsibility by providing cover for the whole of the mortgage. This means that the parent guarantor would have to be able to prove they can afford the entirety of the loan. If a borrower requires a mortgage of 140k but can only prove to afford 110k, the guarantor would still need to have ample income to cover the whole 140k. This may not be possible for some guarantors, especially as the lender will also take into account any other outgoings such as their own mortgages and other credit commitments.

Shortfall guarantor: Rare, but a possibility with some lenders, shortfall guarantor mortgages only require the guarantor to cover the surplus or remaining amount that the borrower can’t afford. For example, if a borrower needs a mortgage of 140k, but can only afford 110k, the guarantor would have to prove that they can afford the outstanding 30k.

If you want to apply for a mortgage with a guarantor, maybe you want to know if you’re eligible or you’re looking for the best deals, please get in touch and one of the experts we work with will be in touch ASAP. If you require help immediate assistance please call 0808 189 2301.

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About the author

Pete, an expert in all things mortgages, cut his teeth right in the middle of the credit crunch. With plenty of people needing help and few mortgage providers lending, Pete found great success in going the extra mile to find mortgages for people whom many others considered lost causes. The experience he gained, coupled with his love of helping people reach their goals, led him to establish Online Mortgage Advisor, with one clear vision – to help as many customers as possible get the right advice, regardless of need or background.

Pete’s presence in the industry as the ‘go-to’ for specialist finance continues to grow, and he is regularly cited in and writes for both local and national press, as well as trade publications, with a regular column in Mortgage Introducer and being the exclusive mortgage expert for LOVEMoney. Pete also writes for OMA of course!

Read more about Pete

Pete Mugleston

Mortgage Advisor, MD

FCA disclaimer

*Based on our research, the content contained in this article is accurate as of the most recent time of writing. Lender criteria and policies change regularly so speak to one of the advisors we work with to confirm the most accurate up to date information. The information on the site is not tailored advice to each individual reader, and as such does not constitute financial advice. All advisors working with us are fully qualified to provide mortgage advice and work only for firms who are authorised and regulated by the Financial Conduct Authority. They will offer any advice specific to you and your needs.

Some types of buy to let mortgages are not regulated by the FCA. Think carefully before securing other debts against your home. As a mortgage is secured against your home, it may be repossessed if you do not keep up with repayments on your mortgage. Equity released from your home will also be secured against it.

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