Should I sell my house to support DS at Uni and get rid of the mortgage?

[ThatMortgageDilemma]

I am a single mother, my child is going to university this Autumn. Given my salary, I know he will get the full student maintenance loan and extra bursaries but... having worked in the area of Student Finance and looking at the price of rentals in the cities he is likely to move to, I know that won't cover all the expenses even if he gets a part time job.

My mortgage deal is coming to an end so I am dithering between getting another mortgage or selling the house, pay the mortgage and move, mortgage free, to a smaller house. All these options could reduce my monthly expenses so I can support DS while he is at uni.

I am not married to the idea of staying in this area for the foreseeable (I think...). I love the house, it is a very desirable area in walking distance to parks, cafes, restaurants, great schools that I no longer need and the train station. My mortgage payments are relatively small, less than what I would pay for a room in a shared house, but it is a big period house, too big for me and expensive to maintain.

In my circumstances, what would you do?

1. Sell the house, pay the mortgage and buy a smaller house mortgage free in a less desirable area

2. Re mortgage the house for 3 years with an interest only deal while DS is at uni, then go back into a repayment mortgage at the end of the period or go by point 1.

3. Remortgage interest free for 3 years, ask for an extra £10000, change bathroom, boiler and do some repairs which will reduce the expenses the house causes me every year so the money can be used to support DS. Then sell for a higher profit when the mortgage deal comes to an end or go as by point 1.

4. Get another Repayment mortgage deal for 3 years which will reduce the mortgage payments by 15%. Then decide what to do close to the end of term. This obviously doesn't help much to support DS while he is at uni.

Would you save enough by staying in the same area but buying a smaller house with fewer repairs? Then you don’t have to live in a Less desirable area, will have more money in your pocket if DS needs some financial support.

I was a student who didn’t have the option of parents helping me. I had two part time jobs and passed with a first, I wasn’t even the student that worked the most. Although by the time it came to it I was helped with a deposit for a house (10k) which I am so thankful for. If you are thinking of giving him money would he appreciate living costs (most likely to go on take away pizza and beer) or a lump sum for a house deposit.

Sell the house because it's too big. But downsize to a nice area where you'd like to live long-term.
Keep any thoughts of your son's finances separate to this decision. Do you have friends in your current area that you'll miss. Any friends you'd like to move closer to?

What has he suggested me to do???

Well....he gave me a pat on the head and told me not to worry about him.

He is a very generous child, he has always said that I should go for what works for me, not him. I'm sure he will survive, bloody resilient he is but I'm his mother and I will worry for him all the time, whether I need to or not...

@Bluntness100

Option five. Tell him to do what millions of other kids do and get a part time job to make up any short fall.

This

Keep the house, get a lodger if you think you need the extra cash, if the house is big then you’ve got plenty of space and you might enjoy the company so your not thrown into empty nest syndrome. Then honestly, I’d go wild, throw raving swingers parties at the weekend and live it up, you’ve worked hard, raised your son on your own, now it’s your time to enjoy a bit of freedom!

Not sure about the raving swingers parties but I have a lot of plans on how to enjoy my freedom when he is not around

I'd downsize mortgage free.

He will need to budget to know what he knows to pay and when, if he sticks to it he’ll be ok. Sticking to it will be hard though

Sell the house if it's too big and too expensive for you to maintain. But buy a house that you love in an area you want to live in. If that gives you more money to support you DS then great.

There are not many courses that you have to go to London for. And London students tend to be less satisfied than non London students. Would your DS consider a different city?

Don’t downsize to fund university. You are making long term financial decisions for a short term need, well actually it isn’t even a need, because you don’t need to do it at all and he can still go to university.

This is your financial future, your son will sort his own out soon enough. Keeping your money locked up in a house is the better long term use for it, you can downsize in the future, it may help towards an earlier retirement or just make life more comfortable in your later years.

I would get a lodger or two to help you with expenses, since you say that this is a large house, and use the money to pay off the mortgage, and support your ds

I'm a single parent also quite nomadic by nature and have settled down for the sake of my children. I would go for option 1 but not tell him that it's for him, in case it did lead to either entitlement or resentment as others have said. Then you'll have a fresh start and spare cash to offer should he need it. A part time job alongside studies never did anyone any harm!

Ohh, a kindred spirit! I never thought I was going to place so much emphasis on giving that stability to my son when I have always wanted to be in the move.

I really don't see myself staying in the house until I am wheeled to a nursing home. I am between options 2 and 3, having an interest only mortgage which such LTV would give me the time I need to make a decision without rushing (my mortgage deals ends this summer) and the money for eventualities.

I need to check however what will be the penalty for interest only if I end up selling before the deal comes to an end.

I have spent nearly £20,000 in repairs in the last 4 years (I have almost paid it all back by now), just for the problem to reappear a few months later. It may be that I'm about to sort it permanently and the house would be problem free as it was for the first 15 years I lived in it, but what if it continues?

Jesus that's insane. With that update, I would definitely go for moving now (with the target date being after DS has packed up and left, so you've got less stuff to sort and nobody underfoot.)

I would personally look for something mortgage free in a "good" area that you like. There's a huge amount of bandwidth between areas which are expensive to live in (which historically tend to be around school catchment areas and commuter transport links) and areas which have an equally acceptable crime rate and facilities, but transport is difficult and/or local schools are not good. If you're working from home and no DC at home, you can cease to worry about either of those factors and save yourself a fortune in housing costs.

You will then have plenty of disposable income every month so you can top up DS if need be. But actually, it sounds like you've raised a strong son with an excellent work ethic, so I don't think you're likely to be needed to bail him out every month!

BTW my son is moving out in a couple of months and I have a similar feeling about shedding myself of "stuff" as part of downsizing. I'm looking forward to being in a flat, which will be much easier on both the cat and myself and our arthritic knees! I've divested myself of a lot of things already and the only purely sentimental items I'm keeping now fit into a shoebox. Getting rid of my enormous collection of comic books was the only thing I shed a tear over!

I wouldn't. I'm struggling to understand your thinking because it's so polar opposite to mine. He'll be fine!
I managed easily having a part time job and studying.

It sounds like you are ready to move on.

My first step would be to find out if I could permanently WFH, freeing me up to move anywhere. Option 1 would be my end goal, to sell up and buy somewhere mortgage free and possibly a rental property (as you suggested) but not immediately.

I would wait until my DS headed off to uni to see how I feel once he has left and research where I might want to move.

In the meantime, I would go for whichever option loses/makes the most money ie

1. Sell up - I wouldn't yet but what are the charges for paying off the new deal early if I sell and no longer need a mortgage? Can I port the mortgage if I buy a new property to live in (using the cash to buy a rental property and for the deposit on my new home)?

1. Interest only mortgage - can I make overpayments if I don't need the money to fund DS?

1. Interest only and £10k equity release - ditto and how much value will the improvements add? What is the cost of doing the equity release at a later point if I wait and see whether further repairs are needed? It may only be the arrangement fee.

1. Repayment mortgage - 15% of £500 is £75. With a full loan, full bursary, a holiday job and an interest free overdraft for emergencies, that is probably enough, even in London.

1. I would consider the option of a lodger as an interim measure, whatever I decided, as a way to help my DS and to add extra cash for my future adventure in the next chapter of my life!

@stablefeet RTFT

@ThatMortgageDilemma, my DS is studying History and there is a very heavy workload at his uni. However he is earning money tutoring and had a holiday job.

I am at you spending £20K on repairs that (if Ive understood correctly) may not have been or be successful!

Buy a smaller lower maintenance place but in a good area you love.

@SwedishK

I think it sounds sensible to move to a smaller and more manageable house. I would hate to live alone in a large house. Keep the money you save aside for a rainy day. Let your DS know that if he's in trouble, you are there to help him.

You don't necessarily need to move to a less desirable area though if you don't want to. Just a smaller house should save you some money, both in terms of smaller/no mortgage and smaller bills.

Totally agree with this. I will be in a similar position in a couple of years time when my youngest (hopefully) goes to University. I see no point in rattling around a big family home and fully intend to downsize.

It's not just about having a little nest egg but also making the move to the next stage of your life.

@EvenMoreFuriousVexation Thank you for understanding and the nice comment about my son. so many people here assuming he is a lazy person trying to survive out of what I can provide.

I love the idea of a flat, and have seen a couple that look great, are in a great location, fit my needs and my budget. But I have a dog I love to bits, if I could teach her to use a cat tray for her midnight and crack of dawn wees, I would move straight away.

Lots of options open to you.....choose the one you prefer longterm with your own future in mind.

Possibly another option is to get a lodger?

Students actually like the security of home staying the same when they first move away.

If you live in a large townhouse in a nice area then surely you could buy a nice flat I. The same area for less? That’s what I would do.

Or, given interest rates have never been lower, remortgage, do some improvements, have a little bit of a next egg to support ds and see where you are in a few years.

Btw as a single mum to an only I totally understand why you would do this... my plan is have mortgage paid off by the time he goes to uni so that I can sell/move/help him as necessary

@Jenthefredo

I can only tell you what ds1 has been advised by both teachers and previous alummni

Agree - DS1 did maths. He had no time for a p/t job. We helped support him as we are with DS2 and will do with DS3 in September.

OP probably best to take advice from those who have actually had children go through uni so know what it’s like

@littlewhitestar

That's a good list. I need to wait until my employer decides what they want to do wrt home working. If they decide to keep us at home, that would be great as I could move out a little bit further which will mean getting the same standard of living but for a much better the price.

I don't think, however, that they will decide any time before my mortgage deal ends in the summer.

I really wish I could be better with maths.A 3 year interest only mortgage will cost me less than £100 per month, the repayment one about £480, it is true that I am not reducing the mortgage with an interest only one, but it gives me the flexibility to use the £380 difference on anything that may be needed or save it to pay it into my new mortgage if I decide to take another in the future.

But then, I may be missing something important that can put me in a difficult position?