I am a First Time Buyer and my parents are willing to sell me a property which they own at a very reasonable price. My problem is that I do not have a deposit and am really struggling to find someone who will offer me a mortgage?

Nationwide are offering mortgages of up to 95% LTV, (though you may need to pay your wages into a Nationwide current account to qualify) - might be worth a look:
Nationwide Mortgages: Calculator Fixed Rate First Time Buyer Remortgage Deals

Hi Sarah,

I hope that I can be of some help...

Currently there are no 100% mortgages available to first time buyers and even if you could get a 5% deposit together you will struggle to obtain a suitable lender. This does not mean however there is not a solution to your problem.



If your parents are selling the property to you at a discount i.e. less than what is actually worth, you can use this discount as a deposit. For eg, if the property is worth £150K but they are willing to sell it to you for £100K you can potentially use the £50K as what is know as a 'gifted deposit'. The actual sale price will be detailed at land registry as £150K and assuming the mortgage lender values the property at this level they will accept the gifted deposit.



Mortgage lenders will only accept a gifted deposit if it comes from a direct family member. It is also important there is extra legal work involved in this transaction and your parents will need to take independent legal advice before considering the above.



I suggest you seek independent mortgage advice to discuss the whole situation in much more detail and obtain a full understanding of what is available and any implications to yourself.

I agree with the above post this needs to be looked at in more details as there may be another way to look at what you are proposing to do.

Look out for a good independent mortgage broker to chat through the options.

All really sound advice. The only thing I would add is that as you are talking about "Gifting", your parents may want to not only seek legal advice as suggested above but also the advice of a reputable Financial Planning Consultant as there could be inheritance tax implications.

There may also be an issue around the price at which they agree to sell the property at, HMRC may take a dim view of someone undervaluing an asset.