For many parents sending is their Son or Daughter to University can be an expensive
time. Tuition fees, general living costs and of course accommodation can all contribute to typical annual University costs of £5,000 per annum.
More and more parents are now looking at ways of mitigating at least some of those annual costs and purchasing a property as opposed to renting is becoming increasingly popular.
Lenders generally speaking are more relaxed about lending in these situations but in essence it is the financial standing of the parents which will determine how much can be borrowed and what the maximum loan to value will be. Lenders will look favourably if equity is held in an existing residential property and income can cover both the current and new mortgage commitment.
The mortgage can either be in the name of the Student with parental guarantor or in the joint names of the Student and parents.
The maximum loan to value would normally be 80% although a higher percentage may be available subject to status.
The property should have no more than four bedrooms with no more than four occupants including the Student.
The property must be let on an assured shorthold tenancy for no more than 12 months.
To find out more about student mortgages please call our Offices to speak to an adviser on 0870 345 3131.