Buying a House for Students

Seamooie

My parents, my brother and I are looking to buy a house together as me and my brother are both at the same university and it seems pointless paying out huge amounts in rent for the next few years.

However, I have a few questions:
1, Does anyone know whether this would affect my status of 'not living at home' for my student loan.
2, What is the best way of going about buying the house - should we have joint ownership, set up a trust?, parents buy it, me and brother buy it, etc etc.
3, What would the best type of mortgage be for this situation considering my parents still have around 10 years of their own mortgage to pay back.

I feel I may have been a bit vague but any advice would be useful.

Thanks

jennifernil

For tax purposes it would be better if you and your brother owned the house. You could get a guarantor mortgage. The amount you could borrow would be based on your parent's income but their existing mortgage would have to be taken into account.
I don't think it would affect your loan, this would only be your term time address.
We have done this for our daughter. A solicitor could draw up something to ensure your parents got back anything they invested in the property.

toonfish

If you can buy it in your names, and rent rooms there will be no capital gains tax liability if sold when you stop living there.

sarah_elton

jennifernil wrote:

For tax purposes it would be better if you and your brother owned the house. You could get a guarantor mortgage. The amount you could borrow would be based on your parent's income but their existing mortgage would have to be taken into account.
I don't think it would affect your loan, this would only be your term time address.
We have done this for our daughter. A solicitor could draw up something to ensure your parents got back anything they invested in the property.

Seconded - a friend of mine and his g/f wanted to buy and live together while at uni, rather than splashing out on rent. His parents guaranteed the mortgage.

Luckily for him, this all happened about 7 years ago, and during the three years of uni the house doubled in value, so they sold and left uni with a huge amount of cash.... Not that I'm jealous.

Also, if it's in your names I'm sure you're fine for your loan - as I understand it, 'not living at home' just means 'not living in parents' home'. Not sure what the exact rule is if it's a house owned by your parents but they don't live in it.