How family support can help with buying a home
For many people, getting onto, or moving up, the property ladder isn’t something they do alone. Support from parents or grandparents has become increasingly common, especially for first-time buyers facing high deposits and affordability pressures.
At Gatehouse Bank, we recognise this reality. Our Shariah‑compliant Home Purchase Plans are designed to support intergenerational help in a way that’s transparent, ethical and clearly structured, so that everyone understands where they stand.
Here’s how it works.
Using a gifted deposit
The most common way families support a home purchase is through a gifted deposit and this is fully accepted on our residential Home Purchase Plans.
A gifted deposit can come from immediate or extended family members as long as they are a UK resident or expat. This includes parents (and parents‑in‑law), grandparents, siblings, aunts and uncles, legal guardians, spouses and adult children with independent income.
To keep things clear and fair, the gift must be a true gift. The person providing it can’t retain any legal or beneficial interest or live in the property and will confirm this through a Gifted Deposit Declaration. We’ll also carry out standard identity and source‑of‑funds checks to meet UK regulatory requirements.
This means family members can provide support without becoming guarantors or co‑owners.
Reducing how much support is needed upfront
Intergenerational support doesn’t always mean large sums of money.
Our residential Home Purchase Plans are available up to 95% finance‑to‑value* for eligible UK residents. That means buyers may only need a 5% deposit – which can be gifted by family.
For many parents or grandparents, this makes helping out far more manageable, allowing them to support the next generation without overstretching their own finances.
An ethical structure families can feel comfortable with
Our Home Purchase Plans are based on a diminishing co‑ownership (Diminishing Musharakah) structure.
Our customer(s) and Gatehouse Bank purchase the property jointly, in proportion to your contributions. You pay rent on the bank’s share, while gradually buying back that share over time — until you own the home outright.
There’s no interest (riba) and the structure is independently overseen by our Shariah Supervisory Board, with published certificates of compliance.
For families providing support, this ethical framework can offer additional reassurance that the arrangement aligns with faith‑based or values‑led financial principles.
Clear boundaries that protect everyone involved
Family members often want to help, without opening the door to future complications.
Our approach is deliberately clear and protective. Once the gift has been made, the person providing it has no ongoing liability for the home finance and no legal interest in the property. We don’t allow second charges or informal family finance to fund deposits, helping to reduce the risk of disputes later on.
In certain circumstances, independent legal advice may be required. This acts as another safeguard designed to protect family relationships as well as financial wellbeing.
Who this approach works best for
Intergenerational support through a gifted deposit can be particularly suitable if:
- You’re a first‑time buyer receiving help from a family member
- You need a gifted deposit rather than a guarantor arrangement
- Your family is looking for a Shariah‑compliant or ethical alternative to conventional home finance
- Parents want to help, without the responsibility of owning the property or taking on finance themselves.
Buying a home is rarely just a financial decision, it’s a family one too. If you’d like to understand how our Home Purchase Plans work, or whether this approach could suit your situation, we’re happy to talk it through.
* Finance to value is the percentage of a property’s value that can be funded by a Home Purchase Plan. For example, 95% finance to value means you only need to provide a 5% deposit.
This article is for information purposes only and does not constitute financial advice. An independent financial adviser can help you decide what’s right for you.