Teacher Mortgages – Things to Know

Can Teachers Get Teacher Mortgages?

There is no such thing as a ‘teacher mortgage’ but there are lenders who are sympathetic to teachers’ employment circumstances.Teachers can lead busy lifestyles with only limited time free so it can be hard to find the right mortgage product to fit your needs.

Lenders understand how teachers’ pension schemes can work and how you may progress from a supply teacher to a fully qualified one after being accepted onto your mortgage. It is important to find a lender who understands your specific situation.

A Mortgage Broker can help simplify the mortgage process by taking on the responsibility of finding the right mortgage for your current situation. Whether you are a newly qualified teacher, supply teacher or self-employed there are lenders out there to fit what you are looking for in a mortgage.

How much can I borrow as a Teacher?

Lenders will take a look into your credit rating and your bank statements to check that you can handle your finances well. If you have a good credit rating you could access up to five times your annual salary.

Some lenders will take into account any bonuses or overtime that you may receive as well as a secondary income. Other lenders will just look into your teaching salary and will completely ignore everything else. It is important to find a mortgage lender who is going to allow you to make the most out of your income; find a lender who factors in all revenue you want them to.

What help can I get as a Teacher?

Mortgage lenders do prefer when they see a profession such as a teacher or a doctor as they are more likely to have stable and reliable incomes. Another way to help yourself is to provide a bigger deposit to your lender up front.

There used to be a ‘key worker mortgage scheme’ to help encourage key workers into buying or renting accommodation. This scheme ended in 2019 but there are still plenty of mortgage products out there to help you onto the property ladder.

Shared Ownership

If you cannot afford to buy the whole of the property at the moment then you can but between 35% and 75% of the property and the rest at a later date. This is often described or referred to as a staircase mortgage.

Lifetime ISA

This gives a £1000 Government bonus if you save the maximum of £4000 a year.

Help to Buy ISA

You can no longer apply for a HTB ISA

Right to Buy

This scheme allows you to buy your home at a discounted price, also known as the preserved right, to buy. You will acquire a discount on buying a property after being a tenant for at least three years.

You need to make sure that you can afford the mortgage that you are paying for, if you miss repayments on your mortgage your home may be repossessed. You should speak to a Mortgage Adviser to ensure you know what commitments you are getting yourself into.

What if I am a Self-Employed or a Freelance Teacher?

If you are self-employed or freelance you will still have access to the same products as a PAYE employed borrower. The difference is in how you prove your income. It is important to keep all of your contracts and any proof of your incomings to hand.

Lenders will usually ask for three years’ worth of accounts to be able to prove your income but there are specialist lenders out there if you are newly self-employed. You need to make sure that you are filing for your taxes through SA302 forms as you will be asked to provide them.

How can a Mortgage Broker help?

No matter what your profession, every financial circumstance is different, and it is important to ensure that you are picking the right mortgage product for you. We work from a comprehensive panel which is representative of the whole of the market.

Mortgage Brokers can offer the financial services to ensure that everything is legitimate.

There are a lot of lenders out there who will tailor towards teachers but they can be harder to find. Brokers will help you with gathering all the documentation you might need for your mortgage application and will ensure you are applying for a mortgage you can afford.

It doesn’t matter if you are on temporary contracts and looking for a Buy to Let mortgage or a PAYE teacher looking for their first purchase, with the right mortgage advice and the pick of the right mortgage deals for you, there will be a lender out there for you.

For our mortgage purchase advice services we will charge a fee of £499

For our mortgage advice services for debt consolidation, Limited company BTL or complex cases we will charge a minimum fee of £1095 or 1% rate charged of the mortgage advance subject to a maximum of £3000. For example, a mortgage of £150,000 would mean a fee of £1500.