Loughborough Building Society has launched a range of buy for university mortgages for intermediaries.
The product is aimed at helping students get onto the property ladder and avoid costly and sometimes substandard student accommodation.
All mortgages are subject to a payment guarantee but essentially the rent earned from the rented rooms is used to make the mortgage payment with the potential to top slice from a guarantor’s income.
Ashley Pearson, business development manager at the society, said: “Buy for university mortgages have been offered via our direct channel for over two years with great success.
“I’m really pleased that this product is now available to our panel of directly authorised intermediaries.
“We’re keen to offer mortgage solutions to borrowers with a range of different circumstances and this is an excellent opportunity for those who in most cases, have never dreamed that they could buy their own home as a student.”
Mortgages are available to student applicant who want to rent out rooms in their own residential property to friends or fellow students.
At a maximum of 80% loan-to-value, variable rates for both 3 and 5-years are available at 4.59% with no early repayment charge (ERC) and a £999 completion fee on an interest-only or repayment basis.
If the student has at least one year left of their course at a University and are intending to live in the property themselves, they can let up to two further rooms to paying tenants.
The mortgaged property must be within a 10-mile radius of the university they are attending and in England or Wales only.