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Mr A

Background of Tembo Money

Tembo Money is a digital mortgage platform that aims to make it easier for families to provide financial help to first-time homebuyers within their family circle. The company was founded in the UK in 2020 and is registered with the Financial Conduct Authority (FCA).

Family support has always played a crucial role in helping people buy their first home. However, with rising property prices and stricter lending criteria, more and more families are struggling to provide the necessary funds. Tembo Money addresses this issue by offering various mortgage options that involve both parents and the first-time buyer.

How Tembo Money Works

Tembo Money follows a straightforward process to connect first-time buyers with their family members to come up with a suitable mortgage plan. The steps are as follows:

Step 1: Signup

The first step in using Tembo Money is to sign up on their website. This process requires the first-time buyer to complete a short questionnaire about their financial situation, property preferences, and family circumstances.

Step 2: Mortgage Analysis

Once the first-time buyer has signed up, the Tembo Money team analyzes the submitted information to determine the best mortgage product for their specific situation. This analysis takes into account factors such as their credit score and available family support.

Step 3: Family Engagement

After the mortgage analysis, the first-time buyer introduces their family members to Tembo Money. The family members can then assess the proposed mortgage solution and decide whether to provide financial support.

Step 4: Application and Approval

If the family decides to move forward with the mortgage plan, Tembo Money helps the first-time buyer with their mortgage application. The team assists with providing the necessary documents and ensuring all requirements are met. Once the application is approved, the mortgage can be finalized.

Services and Products Offered by Tembo Money

Tembo Money offers various mortgage products and services to accommodate different family support types. These include:

Family Deposit Mortgage

The Family Deposit Mortgage allows parents or other family members to use their savings to help with the first-time buyer's deposit. The family member provides a specified percentage of the property's value and will receive a corresponding interest rate. This mortgage product can benefit both parties, as the family member's savings are secured while the first-time buyer benefits from a lower deposit requirement.

Family Guarantee Mortgage

In this mortgage option, a family member uses their property as collateral to guarantee the first-time buyer's mortgage. The family guarantor agrees to cover the mortgage payments if the first-time buyer defaults. Family members can use their home as guarantee if they possess sufficient equity to cover the loan.

Family Link Mortgage

The Family Link Mortgage involves a family member taking out a mortgage on their own home to cover the first-time buyer's deposit. The family member's property serves as collateral, and the first-time buyer will need to have a sufficient income to cover two mortgage payments.

Joint Borrower Sole Proprietor Mortgage

This mortgage option allows a family member to be added as a borrower to the mortgage application without adding their name to the property title. The purpose of this arrangement is to boost the first-time buyer's income, enabling them to apply for a larger mortgage.

Family Offset Mortgage

An Offset Mortgage lets family members deposit their savings into a linked savings account. The balance in this account is then offset against the mortgage balance, which reduces the interest charged on the mortgage. The family member still retains access to their savings and can benefit from a preferential interest rate.

Pros and Cons of Using Tembo Money

  • Offers unique mortgage solutions designed to assist first-time buyers with limited financial resources.
  • Provides access to a wide range of mortgage products that cater to different family circumstances.
  • Facilitates the mortgage application process, simplifying the experience for both first-time buyers and their family members.
  • Registered with the FCA, ensuring compliance with established financial regulations.
  • Committed to protecting user data and privacy through a secure platform.

  • Currently only available to UK residents.
  • Family members need to be willing to put their savings or property at risk in order to provide financial support.
  • The platform is relatively new, and thus their long-term success in the mortgage industry remains to be tested.

Customer Support and User Experience

Tembo Money has a user-friendly website with an easy-to-navigate interface. The website provides extensive information about their mortgage products, which can be helpful to both first-time buyers and their family members.

In terms of customer support, users can get in touch with the Tembo Money team through email, phone, or live chat. The team is available to answer any questions and guide users through the mortgage process.

Final Verdict

Tembo Money's unique approach to assisting first-time buyers and their families in securing a mortgage is undoubtedly an innovative solution in the mortgage industry. The platform offers a range of mortgage products that cater to various financial situations and can potentially make homeownership more accessible for individuals who rely on family support.

However, the success of the platform heavily depends on the willingness of family members to offer financial assistance and the trust they put in the platform. Moreover, it is essential for both first-time buyers and their supporting family members to carefully assess the risks and benefits associated with each mortgage product before deciding to proceed.

Overall, Tembo Money might be a suitable option for first-time buyers who can't afford a deposit on their own and have family members willing to assist in a structured and financially efficient manner.

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