Mortgage on PhD stipend

posted
17-Jul-17, 16:16
Avatar for Auroracase
posted about 2 months ago
Just wondering if anyone has any recent experience with getting a mortgage on a PHD stipend? Both myself and my partner are PHD students and we would love to buy but we have no idea if anyone will lend to us? We have a healthy deposit due to inheritance and know that going through a broker is probably our best bet but would love to hear from anyone who has looked into this recently?

Thanks
A
posted
17-Jul-17, 20:18
Avatar for TreeofLife
posted about 2 months ago
Search the forum - there's been some posts on this a few years ago. I think it's possible. I think lending rules have relaxed recently as jobs have become less secure.

I just asked about getting a mortgage and got approved on the basis of my 1 year FT contract plus the fact that I've been the in same work field for the past 5 years. I feel this wouldn't have happened a few years ago; they would have wanted me to have been on a permanent contract.
posted
19-Jul-17, 02:34
edited about 26 seconds later
by pm133
Avatar for pm133
posted about 2 months ago
Quote From Auroracase:
Just wondering if anyone has any recent experience with getting a mortgage on a PHD stipend? Both myself and my partner are PHD students and we would love to buy but we have no idea if anyone will lend to us? We have a healthy deposit due to inheritance and know that going through a broker is probably our best bet but would love to hear from anyone who has looked into this recently?

Thanks
A


It would not surprise me if you were able to find someone willing to lend money to you in your situation but a word of caution. If mainstream lenders are all saying no, you should think very carefully about their advice.
After your deposit is paid, if you need to borrow less than 3 times your salary (not joint salary) and can survive interest rates of 5 or 6% then this is sensible. If you are relying on both you and your partner earning and/or need to borrow much more than 3 times your salary then you should be extremely careful. Negative equity, redundancy, pregnancy and a sudden increase in interest rates back to the historical norm of 5% are your big risks. Can you cope with these financial prudence stress tests?
posted
20-Jul-17, 10:07
edited about 14 seconds later
Avatar for TreeofLife
posted about 2 months ago
Very good advice from pm133.

Also should note, my mortgage offer is from a mainstream lender (actually my current lender) and I was just testing the water, I haven't actually gone ahead with it because although they may think my income is safe, I of course know better! I'm waiting to get a permanent contact before I commit to something I may not be able to afford if this contact doesn't get renewed.
posted
15-Aug-17, 20:48
edited about 6 seconds later
by sbb0204
Avatar for sbb0204
posted about 1 month ago
I'm a PhD student and have just tried to get a mortgage with my boyfriend who is employed. We went through a mortgage broker and they said that very few lenders would consider our income. We tried them and get turned down because I wasn't able to provide a letter saying I was guaranteed a job in three years when my funding ends. However we were told that this is upto the underwriter and so each situation is different
posted
19-Aug-17, 13:37
by pm133
Avatar for pm133
posted about 1 month ago
Quote From sbb0204:
I'm a PhD student and have just tried to get a mortgage with my boyfriend who is employed. We went through a mortgage broker and they said that very few lenders would consider our income. We tried them and get turned down because I wasn't able to provide a letter saying I was guaranteed a job in three years when my funding ends. However we were told that this is upto the underwriter and so each situation is different


I know this doesn't help you but in the wider societal context it is good to hear that banks are starting to shed some of their old bad habits.
I am still surprised that any lender will consider joint income under any circumstance but maybe this will change as well.
posted
20-Aug-17, 11:07
edited about 8 seconds later
Avatar for wedgegod
posted about 1 month ago
Hi Auroracase... I got a mortgage on my Phd stipend with a 10 percent deposit about 4 years ago. One of my main motivations for doing the PhD was to get a mortgage as previously I was freelancing and it is impossible with an irregular income. I found a few high street lenders willing to lend to me, but when it came to assessing the property they wouldn't lend. This was because the house I could afford was in pretty bad condition (no kitchen and unusable bathroom) but I suspect they may have started to quibble at this point anyway.

I managed to resolve this issue by using the estate agents' mortgage adviser, as he was highly motivated to get me a mortgage and had a position of trust with lenders. I would have assumed beforehand that it was a bad idea to use him, and would result in me being ripped off in some way, but now I would recommend this approach to buyers in a similar position.....He succeeded in getting a mortgage through with one of the lenders who originally baulked at the house....

...and then I spent a year doing up the house instead of my PhD, causing me to run over by a year and I have only just completed. But I would absolutely do the same again, because my mortgage costs half the amount a nasty bedsit would in rent in the area where I live.

Good luck!
posted
11-Sep-17, 13:49
Avatar for daviesmr17
posted about 1 week ago
Hi all, just for those on a Stipend there are lenders out there who will lend based on this as long as there is 6 months remaining on it and it was 12 months long. Also it will all depend on your circumstances as well but it is possible.

Postgraduate
Forum

Copyright ©2011
All rights reserved

Postgraduate Forum

Masters Degrees

PhD Opportunities

PostgraduateForum is a trading name of FindAUniversity Ltd
FindAUniversity Ltd, Sellers Wheel, 151 Arundel Street, Sheffield, S1 2NU, United Kingdom. Tel +44 (0) 114 268 4940 Fax: +44 (0) 114 268 5766