Student mortgages - con?

zeropointone

Hi all....

Fairly new to this business but..........

I'm away down to london at the end of August to study a post grad professional qualification. Looking at property, it seems ridiculous that i'll be paying 400 - 600 a month on rent, when I could be putting the same towards a mortgage for my own place. Now, I know I'm not the first to have faced this conundrum, and given that people still rent, I'm going to gather things just aren't as easy as they first appear..........................

Nonetheless, I'm looking at a buy-to-let on the basis of my parent's current home and for me to rent from them, if that makes sense. But I have three problems -- the first is my father is self employed, the second is my parents aren't particularly enamoured to this prospect; and the third is the massive deposit necessary for a buy-to-let.

So ---- I have heard of students getting 100% mortgages - possibly on a buy-to-let basis ie letting a second room - with parents standing as guarantors on the basis of their current home. My parent's current mortgage is nearly paid off. But from trawling the internet for hours and talking to many a bank, no one can tell me anything about this. It seems, they will give student mortgages, but still with a hefty deposit and further with my parents needing 30% of the value in LIQUID assests. That's just not an option.

Can anyone tell me then, is this 100% guarantor mortage a myth???

Can anyone help??? Thanks all!

herbiesjp

You can get graduare mortgages for 100% and non graduate mortgages for 100%

You cannot get 100% mortgages for BTL

A gurantor does not help you with extra deposit, but their income is taken into account to help you reach the required mortgage amount. There will be deductions taken from the gurantor's income, as with your income, if you have currnet financial commitments i.e. mortgage, loans, HP, credit cards etc

HTH

UK_Landlord_2

You can get graduare mortgages for 100% and non graduate mortgages for 100%

who does these?

herbiesjp

UK_Landlord wrote:

who does these?

Scottish Widows are one lender, but they have specific criteria you have to meet.

Best bet to talk to a whole of market mortgage adviser to find out if you would fit the scenario.

MortgageMamma

Bath building society has a 100% mortgage aimed specifically at undergraduates but you can only get this going direct to them. It is only for students at bristol uni, and they expect the payments to be covered by room rentals. Its a 5.40 discount for 2 years. if your not at bristol you might want to try giving them a call to see if they will be extending it to other areas in future.

MortgageMamma

sorry read you post wrong, i thought you said you were going to uni. a bit early for me!

MM

zeropointone

Thank you all so much for your help and advice - I've gone over a few things with my parents and we've looked at some options so it looks like we'll be able to pull together and get somewhere after all!!

It was really kind of you all to take time to post replies and help out.... seemed like a lost cause, but the advice was useful and certainlygave me the motivation I needed not to lose hope and to try and put something into action!

Best wishes!!