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The bank of mum and dad are now the 10th biggest mortgage lender

Posted in 'Mortgages' by Sam Twyford

30 August 2019

According to a recent survey conducted by Legal & General (L&G), the bank of mum and dad are now the 10th biggest lender in the UK, that’s if they were a mortgage lender.

Legal & General confirmed that the average parental contribution was up by over £6,000 on lending last year, providing their children around £24,100 towards a house deposit. In some parts of the country this figure was even higher and closer to £31,000.

Collectively this amounted to an eye watering £6.3bn, which was more than the 10th biggest mortgage lender, Clydesdale Bank who lent £5bn.

This was estimated to have supported more than 250,000 buyers, the equivalent of one in five of every properties purchased last year, although this has likely come at an additional cost to the supportive parents.

Of those parents surveyed who had helped a family member buy a home, 20% said they felt it was their personal responsibility to help. What was more worrying that 15% of the 1,600 parents surveyed admitted that they had already lowered their standard of living while a quarter were not confident they had enough money to last them through to retirement.

L&G’s chief executive, Chris Knight said “parents and grandparents across the UK want to see their loved ones settled in homes of their own and are giving generously as part of the bank of mum and dad.” He went on to say, “many are using their pensions and savings to help out and unfortunately this could be leaving some facing a poorer retirement.”

Sam Twyford

Sam has a degree in Business Studies from Bristol University West of England, and is an Associate of the Chartered Institute of Credit Management. He is a County football player and has captained local teams at both Truro and St Ives.

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