A house or a independent school for a child

[sindysindysindy]

Hello,
I know it is a bit interesting topic but couldn't explain the situation better then that:)
We live in London... my twins took 11+ assesment this year and they both had offer from one independent senior school . We visited the school and we loved it! -facilities, environment and the GCSE/A level grades are really good. I also checked the ISI report of school it is excelent.
Normally school fee is 17k per a child in a year. But my children got some scholaships so it will be about 15500k each for a year, so in total 31k for both. But unfortunately and husbands salary do not afford these fees. Our both salary is about 52k per annum. We do have mortgage to pay (£1900), 2 cars (we need it for work), holidays, clubs expenses etc...My children is so sporty, one of them plays tennis since age of 5 another loves swimming so I dont want to make them give up from these clubs.
So if we decide sent our children to this school we need to sell our house which is in outer London. Unfortunately renting is not possible as we can only rent it for around £500 a month and that will not help to afford the fees anyway. We can not apply for the bursary as well because we have that house without a mortgage (dept).
Unluckly our local state secondary schools not outstanding. They have good ofsted reports. And to be honest when i visited them i didnt like the environment and students behaviours. I know bright kids can do well anywhere but environment has a vital role on it. Plus facilities, after school clubs options are amazing in private school. I also liked the behaviours of the current students in open day when we visited private school.
Do you think it is worth to sell the house for the private education or leave the house and focus on state then in future kids can sell that house to pay their mortgage deposits or other expenses.
WWYD?

Is it a second home that you are thinking of selling?

@JurassicPerks

How is a house with mortgage repayments of nearly 2k a month only worth £500 in rent?

I guess the Op is implying that £500 will be the only income brought by renting after they deduct the mortgage payment.

I would say, however, it would be less as it us unlikely their mortgage lender agree for the house to be used as a rental without raising the interest rate by 30-40%.

52k each or joint income? Is the mortgage free property separate to the family home? Is there a sibling discount policy?

And do you have other children to consider?

How can you pay mortgage if you own outright?

We earn roughly the same as you - much smaller mortgage. Teachers at independent schools with similar fees - 3 kids. Even with 50% discount and Ex DH paying large chunk of two kids school fees it was a struggle. You really can’t afford it. I think you need to find another solution and selling your house isn’t it.

It sounds like you have to properties? One you live in with a mortgage of £1900 per month? And another you own outright, which I am guessing is a small studio flat if the ten would only be £500 (is that per week or month?)?
How much is the property that you own outright worth?
So many questions!
We moved to a cheaper area to be able to afford private schooling. Personally I would (and have!) sacrifice a lot to pay for private schooling.

Surely you've already had to pay a fairly hefty deposit by now?

I didn't understand your original post regarding property/mortgages, but you need to factor in inflation and extra costs.

DD's fees increase for GCSE years and 6th form. In other words it won't be 7 years of £31k - you will probably need at least £300k, if not more. What about music lessons and sports kit and school trips.

The alternative would be to move to an area with decent schools, though that's a bit late for 22/23.

I’m certainly not anti Private schools but very bluntly you can’t afford it.

I'm not clear on your property situation. Do you have two properties?

Hi everyone, ı am new here and this is my sister-in laws account actually so I do not have experience to open a tread. We would like to sell our addtional house whichnis in outer London. Not our house in London. 52k wa s enough for when the kids was in state primary. İf we sell the house (it was my mothers house, she gave it to me and said ı can sell it or rent it or invest it for kids education) my mother lives with us now so we dont really need that house actually. I was planing to leave it for kids future expenses but at the moment that really want to go to taht private achool and if we sell it I can even sent 3.kid to private school (we dont have 3rd one). I know there will be extras but I calculated its fair enough for both them private school fres until 18 xxx

Sorry for typing errors was in rush:) xxx

So is it her house or yours? Now is the time to put it towards education, if you are going to. It is not unusual for gps to fund school fees but you need financial advice for longer term planning. As you can tell trying to pass property on early (to avoid care fees?) can backfire.

@Sindysindysindy @sindysindysindy make sure you look up the capital gains tax implications of selling a second home. You may be liable for 28% tax on any gain.

FWIW, my child that attended state school far outperformed her siblings at fee paying schools. She also took advantage of many more extra-curricular activities and made more life long friends.

You'd be crazy to lose the security of owning your home.

OP, thanks for the update. It would have been useful if you'd said in your original post that it was an additional property, not the house you live in.

However, I still wouldn't do it.

Is the house otherwise empty now and still needing utilities etc paying? £500 pcm seems low even for outer London

One other possibility that occurs to me, is at least as a stop-gap, find out if you could get an interest only mortgage on the second property, with the interest paid by renting it out. Knowing how much capital you could release that way would allow you to postpone selling the property, though you would need to do so to pay it off at a future date. I'm not sure how much £6000 pa rental income would actually allow you to borrow; but £60000 would cover two years' school fees.

If there is realistic prospect of your family income improving in the next few years, then borrowing against the property for now might make even more sense.

I agree you need to make careful decisions as to the benefits to your children of this particular school. There are lots of different opportunities and environments and it is lovely to have a choice of one that you think is a good fit for your child. Results are not the be-all and end-all but are a factor. We have been happy with the choices that we've made that have meant savings originally earmarked as pension-substitutes have largely been spent on school fees. Largely because of the "everything else" rather than "results".

52k combined salary with 2 x independent school fees? You won't be able to manage this. This is lunacy

How much is the house worth? £1900 mortgage and £500 rent doesn't stack up.

£52k x 2 or combined?

You cant afford the lovely school. Your choices are to send them to the local secondary and concentrate on improving their outcomes with tutors when necessary/extra curricular activities (much cheaper than 31k pa) or moving to an area with better schools.

I think you are mistaken in your belief that you can't apply for a bursary. Bursaries are not restricted to only families who are in rental accommodation. If you owned the property outright with no mortgage then a school might reasonably expect you to fund the fees by taking out a mortgage which would effectively spread your 7 years of fees across 25 years making them more affordable.

Tbh I think you have left it too late though. The application deadlines for scholarships would have been a while ago as they will make bursary decisions at the same time as offering places in Feb & Mar.

It's certainly valid to choose independent schooling over nicer housing if you can still house yourselves. We are paying school fees and are putting up with a house that is too small fir us in a grotty part of town to do this. In 5 years time we can rethink that.

However I can't see any reasonable way for you to house feed snd clothe your family on your current income and also pay those fees.

I would suggest you send them to the state school for y7 and y8 and meanwhile research schools that have an intake at y9 that includes bursaries.

Hang on have I misunderstood - do you have two houses, one mortgaged and one mortgage-free? If you have two houses obviously you can sell one of them and if it's worth more than £217,000 you have 7 years worth of fees. If there's only one house then my previous advice applies - you have to live somewhere and living in a house on which you are paying a mortgage is the cheapest way so you're not doing anything that would make you ineligible for bursaries except just having not actually applied for bursary support before the deadline.

I'm all for living poor to give one's children the best education; ie no holidays, rarely eating out but you must not and cannot jeopardise the security of the home you live as a family. I went to a super expensive private school in my home country, we went on holiday abroad very rarely and rarely ate out. My parent owned our home outright. A responsible parent must do what they can to provide a safe home for their children. We're house hunting at the moment and schools are our priority as I have friends with children travelling over 1.5hrs to school each day because that's the best state school but they can't afford to live in the area. So I totally understand that education is a huge treasure.