With so many different Help to Buy schemes available, and all with different terms and conditions, we explain each one so you can decide which could help you get on the property ladder.
When it comes to student accommodation, I think we all know not to expect a 5* rating, but when you pay your landlord a substantial amount of money each month, and on-time, yet they don’t cover the basics like fixing the broken washing machine or giving your bedroom a fresh lick of paint from the previous tenant, you easily start to question where your money is going – and often it’s towards paying off your landlord’s mortgage on the property!
So, if you’re feeling bogged down by all this, then you might want to consider becoming your own landlord by taking out your own mortgage as a student. Investing in a mortgage as a student is not only potentially a cheaper alternative in the long-run, but you could also have a place to call you own.
In a nutshell, many people look to get a mortgage as a student to:
Student mortgages are for 18+ students in higher education, usually with two years left of their course, and they’re often taken out by people who have access to a lump sum of money - perhaps inheritance or a savings account that you’ve always paid into - which can be used for a deposit.
If your plan isn’t to stick around after you graduate, you can always sell your house and use the money to give you a head start in your next venture. Whether you stay in the property or move on, you’d have hopefully made a saving and given yourself an advantage by getting on the property ladder earlier than your peers.
Many parents choose to help their children financially, whether that’s paying towards university course fees or rental payments. If you do have parents who are willing to help you, then it’s worth sending this article over to them to have a read.
All lenders have different criteria, but generally speaking the requirements are:
If you’re considering renting out rooms, bear in mind you can only rent out rooms that are listed. Renting out rooms is a popular option as the rent money could cover, or contribute to your mortgage costs each month.
Since student mortgages are becoming increasingly popular, finding lenders who offer them is easier than ever before. But without a full-time job, many lenders tend to reject applications for student mortgages, as they’re a high risk.
However, there are certain things you can do to make yourself a more attractive borrow. These include putting down a large deposit and having a mortgage guarantor.
Putting down a large deposit means you’re less of a risk to lend to. Many lenders will ask for a ten per-cent deposit, but if you don’t have this much, we recommend you speak to a mortgage adviser as they might have access to more specialist lenders that don’t require a large deposit. A mortgage adviser will also be able to advise whether it’s worth taking the time to save more money for a deposit, or if this might outweigh the benefits of getting on the property ladder as soon as possible.
Basically, a guarantor is someone who has your back should you not be able to pay your mortgage back.
A guarantor is usually either your parent(s), grandparents or legal guardian, and must adhere to the following criteria:
As your guarantor is responsible for paying the mortgage in the event that payments are not made on time, they must be able to prove they have a minimum sustainable income. For some lenders, in the case where both parents live together, it’s a requirement that they both act as guarantors.
Student mortgages are dependent on your guarantor not only for security measures, but also for their credit history. This is because as a student, and assumingly a first time buyer, you may have very minimal credit information; too little to build up a real picture of your credit history anyway. There are ways you can improve your credit score, if you’re concerned your guarantor might have a bad credit history.
If you think a student mortgage might be right for you, please don’t hesitate to get in touch with our friendly team and they’ll be able to talk you through the process. In the meantime, you might want to work out how much you could borrow.
Your home may be repossessed if you do not keep up repayments on your mortgage.
There may be a fee for mortgage advice. The actual amount you pay will depend upon your circumstances.
The fee is up to 1% but a typical fee is 0.3% of the amount borrowed.