Understanding Mortgages on a Stipend Income

Getting a mortgage with stipend income doesn’t have to be stressful. If you are looking to secure a bursary mortgage or simply want some friendly mortgage advice, Pete and Adam at Lloyd Wells Mortgages can help.

Can you get a mortgage on a stipend? Of course you can.

You might be concerned that your income is too low to get a stipend mortgage; while you are busy focussing on your studies, that last thing you want to be worrying about is finding the right lender.  For standard mortgages, lenders take into account affordability, income and a few other key factors. When it comes to stipend mortgages, things are calculated a little bit differently. The mortgage market is always changing, so we advise that you don’t get caught up in the who, what’s and why’s. If you go to a trusted mortgage broker, you can receive invaluable advice to get your mortgage application rolling.

Stipend Mortgages in the UK

Many UK-based mortgage providers avoid stipend because they don’t believe that the sums received can justify a loan – they don’t think you’ll be able to make the repayments. Others may see you as high risk when applying for a mortgage with bursary or stipend income because your future income isn’t guaranteed. They will want to know if you are applying jointly, how long you will be receiving stipend or bursary, as well as if you have any firm job offers in place for the future.

Don’t let this put you off. A lot of lenders out there will take your future income into account and acknowledge that the majority of bursaries and stipends are tax-free. Not only can we help you find them, we can also help you put your best foot forward and show how reliable you are with your monthly outgoings and how strong your financial position is.

It is true that the majority of high street banks tend to avoid stipend or bursary income, but as a whole of market broker we work closely with many PhD stipend lenders to make sure that we can find the right finance for your circumstances.

How much can I borrow for a stipend bursary mortgage?

This depends on the amount you are trying to borrow against the valuation/price of the properties you are interested in. Most lenders to see a deposit that comes from your own finances.

Lenders will always have a maximum loan-to-value (LTV) percentage which they will not exceed. For stipend and bursary income recipients, some lenders may offer a lower LTV.

Applying as a joint applicant with another person who has conventional income may improve the amount you can borrow. As with any mortgage, how much you can realistically afford to repay each month is calculated against your mortgage borrowing. There are lenders who are happy to take stipend income as a single income and therefore lend up to 4 x that income.

What is the difference between a stipend, bursary and scholarship?

A stipend is a sum of money given to you in advance by an employer or organisation to cover some of your basic living costs. This is mort often given to those in education or clergy.

A bursary is money you receive that is usually income-related and is nothing to do with academic skills or achievement – financial aid related to this would be a scholarship.

Highly experienced in mortgages of this kind, we are used to helping students from all over the country secure the funds they need to purchase their first property. To discuss your individual circumstances and to start applying for your stipend mortgage, call us today.

Next Steps

If you are thinking of buying a property and have a stipend income, then do give us a call on 01174 520 330. Our initial conversations usually last around 15 minutes.

Alternatively, you can email enquiry@lloydwellsmortgages.co.uk and let us know how we can help you.

We will discuss:

  • How much you can borrow
  • What that will cost
  • What fees can you expect
  • How Lloyd Wells Mortgages work
  • What insurances you will need
  • What documentation you will need to provide
  • Next steps

Your home may be repossessed if you do not keep up repayments on your mortgage.