Obtaining a mortgage whilst studying for a PhD?

[RastaManBob]

Hi,

Just wondering if anybody has any experience of obtaining a mortgage whilst studying for a PhD? I've read conflicting reports that (a) It is possible as the bank does not care where the money comes from as long as you are able to pay on time and (b) It will be impossible as the only income during a PhD is the stipend which can not contribute towards income.

Does anybody have experience of which is correct?

I currently do not have sufficient money to consider getting on the housing ladder however I've always disliked the idea of renting (And have therefore avoided it)... However with PhD funding being so reasonable (£15k tax free) I'm hoping it may be enough to consider buying... Especially considering that (After tax) many of the graduate jobs available pay approximately the same (At least in the first year).

All of this obviously assumes I can get the deposit from somewhere, but otherwise a quick check seems to suggest that the difference between mortgage repayments and rental is minimal... In which case I'd rather my money did something for me.

At the moment this is simply ideas floating around in my head for consideration, and may be a purely silly idea - But that's the stimulus for asking and hopefully getting some feedback on here.

Thanks.

 

[RastaManBob]

Out of curiosity, what PhD are you doing?

I'm not doing one as we speak however in my final year of undergraduate University (4th year MEng, Electrical and Electronic Engineering)... I'm currently considering the pros and cons of what to do next year and PhD is one of the considerations along with just getting out there and working...

The main hurdle with the PhD appears to be the issue of it paying a stipend rather than a salary however I don't want to let the oppurtunity of doing a PhD passing me by for this alone so currently trying hard to decide!

Out of the research divisions available at the University of Nottingham (EEE) I'm more inclined to go with the Optics division however I'm also trying to see if there is anything more suitable at the moment (I'd like to consider something that may overlap with Comp Sci a little more).

 

[RastaManBob]

You'll find it *massively* difficult to get a mortgage on a single PhD stipend. At the moment you'll need a 10% deposit, and they will most likely only give youa 3X multiplier on the 15k (so you should be looking at properties at the 45K range if there are any).

Hopefully (Fingers crossed!) by the time I'd be applying for a mortgage my girlfriend should have managed to obtain a place on a GTP course (Training to become a primary school teacher). This pays around a similar price range I believe however I am also unsure whether this counts as a salary of stipend or other.

As I said, at the moment nothing is for definite but certainly want to make sure I've considered all avenues.

 

[RastaManBob]

phd grants don't count as income, and unless you have income to afford the repayments, you can't have the loan.

Assuming you can find the deposit elsewhere and the PhD stipend covers the repayments (Big assumptions but let them stand...) would the the lenders consider it? Or is the fact the money is derived from the stipend a short and sweet "No!"?

 

[RastaManBob]

Thanks for answers all At least it's cleared a little up... I s'pose there is no harm in asking if/when the time comes but for now at least I can assume it's a no. Cheers.