Financial Help / Bursaries(84 Posts)
Our daughter attends an independent secondary school on a full fee paying place. Shortly after she joined our household income dived to less than £24,000 p.a. due to the resession and her grandparents stepped in and loaned us the school fees for the past two years. However, they are now struggling and can no longer afford to help us. We now have to decide whether to move her to the state system or go cap in hand to the school. However, we have over £1,000,000 equity in our house (have lived here for 20 years), which I know sounds a lot but we do not earn enough to re-mortgage or even change our provider (we still owe £300,000). We also have around £15,000 savings for emergencies, which we actually owe the grandparents for the fees but they have kindly said we can sit on the money for now as it gives us security in case of broken boiler; car repairs etc - none of which can be funded from our income.
Wondering whether anyone has had a similar experience, i.e. applied for a bursary with property equity and savings, and whether it's worth asking the school for help or would they expect us to sell the house? I know the answer is to just ask them but it's not something we will find easy to do, especially if it's a crazy notion due to the property equity. I know on paper we sound well off but we are really struggling with day to day cost of living. Thank you!
Sell the house, move to a 600k house in a grammar school area.
And still be wealthier than 98-99% of the population with 500k in the bank.
SILLY POST OP.
Is there any prospect of recovering your former income?
Because if not, then downsizing the house makes sense for wider reasons than school fees.
It won't do any harm to ask the school. But if they have allocated all their bursary pot for this year, then there may well be nothing they can do - though they may be able to offer deferred fees if your DD is in an exam critical year. This will cost you more in the long run (they will add interest) but that might be worth paying of you are seeking to avoid disruption during GCSE preparation.
Schools may have some tolerance for equity in a house if remortgaging just means a different unaffordable bill. But probably only to cover a short term crisis. In the longer term, moving house or state school might be the only achievable options.
Every school will be different. Ask them. The worst that they can do is say no.
I'm not a parent with a child in an independent school but I very much doubt you'd get additional support with £15,000 in the bank, whoever it's owed to - you're sitting on it, they'll take it into account.
I do not see how you can be servicing a 300K mortgage on an income of <24K. But - £1m in equity? £15K in the bank? This is a wind up, right? To be in that position would make you ridiculously privileged. Sell the house.
I can only talk about boarding schools where £15 000 is a drop in the ocean when it comes to fees. Due to recent good fortune I've now got £7000 in the savings having previously had £35 I declared it straight away and our school weren't interested.. Every school is different there is no universal policy but at my DS's school 5% of you assets will be taken into consideration. As they say do the math! As far as I understand at my DS's school when a bursary offer is being worked out its just a number crunching exercise you earn A, 5% assets of your are B and you monthly expenditure is C we are only asked about mortgage/rent, insurance, pensions and cost of other family members, not utilities, council tax, food, petrol (a big expenditure for us as we're rural) C is taken from A and B the total is D that puts you in an income band and that income band tells you what reduction they will offer you.
Owning a house is not a reason why bursaries are turned down we all have to live somewhere, rent is expensive and some equity in a house is normal as 100% mortgages are no longer available. Most bursars are realistic and are happy for you to live in an averagely priced for you area three/four bedroomed house (assuming you an average family) with 25% in equity but frankly I cant see any bursar agreeing to offer you financial support if you live in a £1.3 million house which must be way above the average for your area (unless you live in Belgravia and even then i think they would expect you to move to a cheaper area) with £1000 000 in equity.
A friend applied for a bursary she had a second home they told her to sell it and pay the fees with profit from the sale. "But its my pension money" the reply was simple "what is most important to yoiu a pension or your DC's education?"
Your right Xoanon this must be a wind up!
middleclass that sounds a bit unfair for your friend. If her money was in a pension fund it would be completely inaccessible to fund any school fees. I would have thought that they would have asked her to confirm she had no other pension arrangements in place and treated the second home value as her pension value.
It may be quite hard to sell and still live in the same area so having a large amount of equity does not always mean you can access those funds and continue living in the same area.
You might not be able to move if you rural but supose if you live in central London where an average house price in Belgravia might be £.13 million I suppose you could move 4 miles down the road to Stockwell for example and still be in commuting distance of your DC's school.
With regard to the pension my friend had bought a seocond home and was renting it out when she retires she plans to sell it and invest the money and use it towards her pension. I personally dont think its unreasonable of a school to ask you to make choices. To own one average sized/priced home with 25% equity in fair enough as we all need a home of some description but the second home and the future pension it will generate in many peoples books is a luxury and beyond the reaches of many.
I'm afraid I think they would decline a bursary since, whilst your income has dropped, your equity had stayed the same (and depending on where you are, probably increased in the past 2years). That amount of equity is huge, both in actual and percentage terms. And I live in London where house values of a £1m are scarily common. I think you would find it hard to claim that you had no options available to you other than financial assistance from the school. They will point out that you have a very readily available option to sell your house, buy somewhere for £800,000, have zero mortgage and £200,000 cash for the next x years of school fees.
I'm intrigued whether you really think a bursary is appropriate in your circumstances?
Alien I'm not intrigued I think this is a wind up. No sane person with this level of equity would even ask and as already pointed out you couldn't pay a £300 000 mortgage on an income of £24k.
Well, well, we have Shona Sibary worrying about going bankrupt while loaded and living in the catchment of Bohunt School.
If you get a bursary I'll be deeply pissed off with the school for misdirecting funds.
Of course it would not be appropriate for the OP to receive a bursary.
I speak as someone who has downsized property to be able to fund my ds's secondary education since, due to ill health, our income has fallen to a similar level to yours.
And I'm talking from a £230k to a £180k property...
My Family have "JUST HAD TO SELL THEIR 25 BEDROOM MANSION"in Surrey "MY FATHER CAME OVER FROM RUSSIA IN THE 1990 s His wealth as dropped from $ 3.2 Billion to just over $200 Million.
I Am Begging ETON TO GIVE BURSARIES TO ALL 10 of my SONS As WE CAN NO LONGER PAY OUT £350,000 a YEAR IN FEES. On TOP OF MAINTENANCE YOU CAN NO LONGER LIVE IN LONDON ON $5 MILLION A YEAR.
I'm loving the stealth boast of "I've got a million quid house with 700k equity, you poor people just don't understand how hard it is to have a net worth close to a million."
I suspect a lot of people struggling to put food on the table would regard £24k per year as a fortune, and would be happy to take a moment off from struggling to feed their families to stuff your house up your arse.
friday the not so stealth boast is a house worth £1.3m with £1m equity
Talk do you really think the OP is SS?
no, but it did make me laugh a lot when I saw the school she turned down ....
every parent within 4 miles can get a place there
Londoners eat your hearts and stomachs out
(daft mode cos us in south hampshire are having a hard time choosing WHICH of the amazing 6th form colleges to send our kids to!
spoilt - we know)
Eton College .
FOR THE ATTENTION OF THE BURSAR.
Please can you help us, my Husband Sergei Obnisnovisky came to your country in 1992 from Russia with $3.2 Billion Dollars.
It was Sergei and my wish for our 10 boys to be educated at your
fine establishment, we even put away £2 Million Pounds in trust funds in the ZURICH Branch of U.B.S to cover fees and other expenses for our boys. However Since 2008 Sergei has lost $3 Billion Dollars in business.
Sergei and i have had to sell our beloved 300ft yacht and can no longer afford the aviation fuel on our 747. Our House in Kensington Palace Gardens has £50 Million pounds equity but our income has dropped to just
$5 Million Dollars per year. Would you please offer our boys Bursaries to attend your fine school.
If you have over a million in equity, releasing £15k a year from this is the right thing to do. It's not fair to ask other parents to support you when you have options about supporting yourself.
If you've earned enough in the past, you will not be on £24k forever.
If the worst comes to the worst, you should sell your house and buy a much cheaper one.
this reminds me of my fav thread in property when someone had £5m to spend on a house and told me"they were not rich".
op- if you are for real, just read your post out loud. What do YOU think. i would also add, just for good measure- if i was your dd and went to a very nice private school and had to move but subsequently worked out that my parents had a million quid in the bank, i would not be happy.
But the OP doesn't have £1m in the bank. It's the value of the house. It's not real money at the moment - it's just potential. So the option is to sell the house and move somewhere cheaper. So the OP has to decide whether the private school or the family home is more important to them. In theory moving sounds simple but there is some expense involved too which would have to be paid from the proceeds of the sale.
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