The Vernon Building Society has launched the Buy for Uni mortgage to support students onto the housing ladder and through university.
The product enables parents to help their children buy a home without having to directly fund a deposit, by becoming a joint borrower on the mortgage and providing supporting security on any mortgage amount over 80% of the property value with a collateral charge on their own property or a cash deposit (which will earn interest).
The borrower owns the property in their sole name and the parent is not on the title deeds (therefore isn’t liable for Stamp Duty).
The hybrid buy-to-let and guarantor-style mortgage product is only available from a handful of lenders and the Vernon’s Buy for Uni is a current best buy at 4.70% up to 100% of the property’s value.
In addition, the five-year discounted rate comes with no Early Repayment Charges.
Buy for Uni is available direct and through limited intermediary distribution (L&G Mortgage Club, SimplyBiz Mortgages, PMS and Sesame).
Tom Gurrie, intermediary sales manager at Vernon, said: “Many parents want to help their children onto the ladder and ease the costs of putting them through university, and the Buy for Uni Mortgage lets them do both.
“Instead of paying rent to a student landlord, the student becomes the landlord, receiving rental income that helps cover their mortgage repayments, while having a secure home for the duration of their degree course, or beyond.
“And with a flexible range of onward options, they can relocate, stay put or sell up without any Early Repayment Charges. This flexible, forward-looking mortgage product helps parents to give their children an invaluable leg-up on to the ladder.”