What Mortgages are Available for Teachers?
Is there a special mortgage type for teachers and teaching staff?
There is no specific mortgage product that is aimed exclusively at teaching staff. As a teacher, the mortgages available to you are the same range that are open to the majority of other applicants, however, your chosen career does afford you some benefits with certain lenders.
Are there special rates for teachers?
Some Mortgage Lenders, usually independent, rather than high street lenders, offer special discounts to those in the teaching profession. Mortgage deals can range from reduced or free arrangement fees, through to lower mortgage interest rates.
These offers, whilst available from niche lenders, are usually fairly widely available across the educational professionals spectrum, with those employed part-time, full-time or even on temporary contracts, in any of the following roles, usually being eligible:
- Fully qualified teacher/lecturer
- Teaching assistant (NVQ level 3)
- Newly qualified teacher (NQT)
- Supply teacher
- Nursery nurse (NVQ level 3)
- Children’s therapist
Teacher mortgages for First Time Buyers
If you’re a First Time Buyer who also happens to be a teacher, this won’t have any impact on the availability of mortgage options, or your chance of securing one. Mortgage Lenders will be looking to ensure that you meet their affordability and credit score requirements. So long as your income is stable, where you earn a living is of little consequence.
If you opt for a Standard Residential Mortgage then you will ordinarily need 10% deposit and are able to borrow somewhere between three and five times your annual income, depending on your individual circumstances. Those who have struggled to obtain a mortgage through the traditional process, however, will be glad to know that many of the government’s home ownership schemes can be advantageous for teachers and educational staff.
Help to Buy
The Help to Buy scheme gives applicants access to a government loan of upto 20% of the cost of your home (40% in London). On top of your minimum deposit requirement of 5% this gives you a 25% deposit (45% in London) in total. This reduces the Loan to Value ratio of your borrowing to 75% (55% in London) meaning that lenders are more likely to approve your application. Lower borrowing also opens up better interest rates.
The Shared Ownership scheme offers a realistic step onto the property ladder for those on lower incomes. Through a Housing Association, you purchase as little as 10% of your home (or up to 75% initially) and pay rent on the remainder. As and when you can afford to, you can increase your ownership in increments as small as 1% at a time.
The NewBuy Scheme is only available to those looking for a new build home. It gives you the chance to buy one with just 5% deposit, using a 95% NewBuy mortgage. There are regional pricing caps in place with regards to the maximum property price allowed through this scheme, but the interest rate is subsidised by the government and therefore around 75% of the cost of standard mortgage interest rates.
Remortgaging and Buy To Let for Teachers
Again, the fact that you are a teacher will not affect your access to remortgaging or Buy to Let options. As teaching is generally considered to be a stable career choice, you will often experience a more straightforward application process than other applicants.
Does my career stage affect my options?
Newly Qualified Teachers
Newly qualified teachers (NQT) are fairly often taken on, on a short term contract, whilst they secure a permanent teaching job. Applications can be a bit more complex for contract workers, but there are independent lenders who offer mortgages to Newly Qualified Teachers.
As a supply teacher, your job is considerably less stable than other teaching staff, so it may be more difficult to find a Mortgage Lender willing to consider your circumstances. So long as you have a minimum of twelve months of continued employment in this role, however, there will be specialist lenders who can help.
As a retired teacher, your full teacher’s pension will be considered by the lender with regards to your borrowing. Your age will factor into their decision, but the right mortgage advice beforehand can ensure you approach a lender who can help.
Mortgage protection products
As a teacher, it’s fairly common to have employment and mortgage protection policies, as part of your employee benefits package. This can be beneficial to provide to the Mortgage Lender, as it reduces the risk involved in offering your mortgage, making it easy to secure one.
How can The Mortgage Brokerage help teachers to find a mortgage?
At The Mortgage Brokerage, we match teaching staff with those Mortgage Lenders who are most likely to consider your circumstances and have special deals and discounts available to you. As a busy professional, we know that your time is precious, so we’ll take on much of the administrative burden for you, reducing your stress and input.