Hi I posted a message about mortgages a while ago, but our position has changed and I wondered if anyone had any ideas.
We want to buy a house for 230k, we have 200k to put up front leaving 30k which we need a mortgage for. Both my husband and I are PhD students with joint research council funding of c. 28k. I wondered if anyone had been in a position where they needed a very small mortgage with only research council funding. We can't get guarantors.

Thanks!

I don't see what your problem is or have you been turned down for a £30K mortgage already. With such a massive deposit I can't see why this would be the case. Compared to most people - students or otherwise you seem to be in an extremely good position and I'm sure you don't mean to do this but for those of us who are struggling to pay rent or trying to get a mortgage for the cheapest house possible, your question comes across as rather arrogant.
If you have been turned down for a mortgage or loan for £30k then there is absolutely no hope for anyone else.

It wasn't meant as in any way arrogant. We have indeed been turned down for mortgages for this small an amount with several banks who will, in short, lend us nothing. 200k is not enough to buy a family home where we live.
I didn't meant to rub it in, I come from a very deprived background and am well aware of the tribulations of paying rent, etc.. with very little in the way of income.

.... all I was doing is wanting to know if anyone from experience knew of any lenders that might be sympathetic to situations in which a small mortgage was required when the vast majority of the equity could be purchased.

Pamplemousse,

In my opinion, you have NOT come across as arrogant. You just provided information to allow people to answer your question. Unfortunately, some people have money worries and so this may be a sensitive issue for but that's not your problem. Can't help you I'm afraid but hope it all works out.

Yes, what Delta said.

I've not a clue as far as mortgages go, but £30k is the kind of sum you could potentially get from a Professional Studies Loan. HSBC offers up to £25k per person and repayments don't start until 6 months after your PhD registration period finishes. I was able to get one a few years ago just by showing proof of my £12k stipend and explaining a bit about how it would be spent (e.g. travelling, car, books, conferences, furniture, etc.), and how employable / high income the PhD would make me (big lol at that). You'd have to wing it a bit I guess but perhaps it's worth a try. Good luck both of you.

Have you considered using a specialist mortgage broker? A colleague of my husband did this - he was a post doc but on a very short term contract and most banks wouldn't touch him at all. The specialist broker was able to find mortgages which would cover his less than ideal situation, and my husband's colleague got the mortgage he needed.

I was also going to suggest I broker and to target any applications carefully - each time you apply for credit it goes onto your credit records and apparently lots of searches close together will count against you (as proof that others have not found you credit-worthy recently).

Ah well, our mortgage broker just got back to us saying that no-one will offer us any kind of mortgage of any amount on our funding.
Slightly pee-ed off as you can get the mortgage we want if you have one gross salary of 8k!!!!!
The mortgage market is clearly stuffed!!!

Have you tried other mortgage brokers? I used to work for a high street bank and I know that they accepted stipends as income, for mortgages, loans, credit cards, the lot, so I can't see why you're coming up with such difficulty. Are your stipends due to finish soon or something like that?

A bit off the wall, but is buying really a good idea? No idea how far on you are with your PhDs, but if either or both of you are interested in academic careers then, you are probably going to need to be nationally / internationally mobile, and a house then really can become an expensive millstone. I have a friend who bought during his PhD (wealthy parents) and he's now stuck paying mortgage and rent where his new job is, can't sell the house (in negative equity too), and is considering going bankrupt as the best option. Obviously if academia isn't an option and you're fairly sure you can both get jobs where you are then it's a different case.
On mortgages have you tried the teachers building society? Maybe an educational specialist might be able to get their head round your situation better.

Apparently stipends used to be classed as income, but are no longer because of the current credit crunch. We've both got just over two years left to go.
RE: mobility, my other half has no intention of being an academic post-PhD. He's a qualified teacher so work-location isn't really an issue. We're also planning on having a family by then, which makes me less inclined towards a career in academia (I definitely wouldn't be prepared for drastic moving to do it).... and if we did move, the mortgage that we want would only involve paying back £170 a month, which I don't think would create too much of a problem.
Thanks for the advice anyway, we'll just have to plug away I guess!

Pamplemousse, I'd like to apologise if I came across as harsh in my post yesterday. I can see that even though it appears you have a large amount of money to put down on a house, if you can't get a mortgage then you are still in the same position as anybody else who is trying to use their PhD stipend as income. It really does show how bad the financial world is at the moment. Good luck and I hope you do manage to get a mortgage or a loan of some sort.

One of the other major problems then is that you only have a guaranteed income for two years or whatever, so that's another thing probably counting against you in their eyes. Lending policies are just so much more stringent these days, that it's difficult enough to get any form of borrowing, let alone when you're classed as a 'student', on a tax free income, and one that's only guaranteed for a few years etc.

Much as it is impossible to predict, there's a good chance of prices falling further - especially after the next election - so in due course your (v. impressive!) £200k may be enough for property in your area. In the meantime, I was chatting to a friend who is a broker recently about the difficulties of this situation and I would definitely suggest that as the way to go. Take care about whether they work by fee or commission though...