Are you looking to take out a mortgage for a child studying at university in the UK? Students from around the globe are drawn to the UK for higher education, due to the prestigious reputation of UK universities. We therefore regularly see clients who want to purchase property in London and the wider UK for their children to live in whilst studying. This provides security for the child whilst also acting as an investment for the family, instead of renting for four years with no return.
I recently arranged a mortgage for a child studying at university via their mother, a Russian national living and working in Russia. She hoped to purchase a £2million property in Central London, in order to provide the necessary security for the duration of her child’s studies. However, her daughter was not of an age to take out a mortgage and obviously did not have a salary, so the mother wanted to purchase the property in her own name.
Unfortunately, the mother’s income alone was not enough to support the application. Ideally we needed to take her husband’s income into account to judge the affordability. However, he did not want to be named on the deeds of the property or take on another mortgage.
Fortunately, I was able to direct this client to a private bank who are prepared to accept personal guarantors for large mortgages. We therefore used him as a personal guarantor for the mortgage, enabling them to borrow at 75% loan to value or £1.5million. This would be at an interest rate of 3.5%+ LIBOR.
This was a great solution for this family, as it means the daughter will be able to live securely in a lovely area of London whilst completing her studies. This will also serve as an investment for her family, as London property is widely regarded to hold its value.
If you are an international investor with a child studying in the UK, securing the appropriate mortgage finance can be difficult, but there are solutions available if you have access to the right contacts. If you would like to know more about a mortgage for a child studying at university, I would be happy to run through your options at your convenience.