Using my PhD income to get a joint mortgage?

little_me_5

Hi there,

My partner and I want to buy a house soon-ish. At the moment, we're having a slight issue when talking to the banks about how much money they would lend us. My partner is employed full time, but I am a PhD student. Although I am not employed, I do get about 12k tax free per year from the science council which funds my PhD. All the banks I have spoken to so far (Abbey, Halifax, Nationwide, HSBC, NatWest) won't take my income into account for a joint mortgage. So we could only borrow based on my partner's income, which restricts us quite a bit. I know banks used to accept the PhD grant as a source of income, but seem to have stopped fairly recently. Does anyone know of any banks that might still be willing to take into account my income?

Thanks

Toughluck

You may need to go to specialist lending if you want this property.

Companies like Beacon home loans, First National are quite flexible like that and will take it. I think you need to decide if you want a bank as a lender you are not going to get the mortgage therefore going through a broker may be the only way forward for you.

sarkin

Agree with toughluck save your leg work and phone a whole of market broker in your area.

little_me_5

Thank you both, I guess I'll have to find a broker

minimike2

Thats because your £12k PhD income is meant to be for funding your PhD not for paying a mortgage.

Glitzkiss

Actually the 12k will have been awarded as living expenses and therefore can be used for a mortgage. Bench fees paid directly to the university/research institute are used to fund the research for the PhD

minimike2

Glitzkiss wrote: »

Actually the 12k will have been awarded as living expenses and therefore can be used for a mortgage. Bench fees paid directly to the university/research institute are used to fund the research for the PhD

That must be the reason that all lenders accept it as income for mortgage purposes then!

Glitzkiss

I've no idea why many mortgage lenders have stopped accepting it but it is awarded as a source of income. PhD students are expected to work full-time plus on their studies and, especially in their final year, may work young doctor-length hours

oranges7

minimike2 wrote: »

Thats because your £12k PhD income is meant to be for funding your PhD not for paying a mortgage.

So, what exactly do you think it should pay for? "Funding your PhD" is a pretty ambiguous statement, perhaps you should elaborate. Do you mean fees? Costs relating to carrying out the research? Or something else?

Statements like this make me :mad:. It shows your complete and utter ignorance of how research is funded (particularly science ones).

Tuition fees = £3k a year: These are paid directly from the research council. This is ON TOP of your ~£12k a year.

Bench fees (to cover lab costs/consumables) = ~£5k a year depending on your lab: This is also paid directly from the research council ON TOP of your £12k.

Travel to conferences/ other course fees: These are also covered by the research council and/or institution.

After the research council paying ALL of your PhD costs plus they ALSO give you a wage of £12k to support yourself in return for the work that you perform for the research council as part of your PhD. I dare say in the same way that your employer pay you a wage in order to support yourself in return for the work you perform for your company. What is the difference? (I understand you may work for yourself, but I am making a point). Should you only be allowed to spend your wage on getting to work?!!!

The difference is that your income is liable to tax and the OPs isnt. THAT is why the banks don't lend based on it. It is a blanket policy not to lend based on ALL non-taxable income...that includes income from abroad (and no one would dare say anything as moronic as "that meant to support the country it came from":rolleyes:).

In order for the OP to support herself, she needs to live somewhere- either way she pays her own mortgage repayments or the mortgage repayments of some BLT landlord.

Condescending remarks such as yours only go to show how ignorant you obviously are regarding research. A PhD is essentially a job, that is rewarded with a wage. If happens to have an opportunity to achieve a qualification at the end of it,- much like an apprenticeship (indeed a science PhD is the apprenticeship to be a research scientist). You'd never suggest that an apprencetice plumber/electrician should only use his wages to "pay for his apprenticeship"!!

The "student" label is misleading, because there are no exams, no lectures, no student holidays....instead you have a boss, an office, responsibilities and a 9-5 job (although that'd be underestimating it!) with a wage. More like an employee than a student, i think. Perhaps you should therefore rethink your perceptions about how a PhD stipend should be used.

Toughluck

Also income tax is not paid on the PhD and this isn't looked upon with great delight in mortgage lending terms. It is to assit the student to attain a qualification.

You stick to what you know and we will stick to ours.

In my experience, bursary's, grants, whatever you want to call it should NOT be used to get a mortgage and the OP is obviously finding it difficult to get a bank on board to help them out.

inca_2

There are a couple of high street lenders who will take it as income but not all as you have found out. A good broker will be able to sort you out with this. Make sure they are whole of market and good luck with it all.