bursary and remortgaging the house...

[stripes11]

we have a bursary at school, partial. i am thinking to sell our residential house and buy in a different area, closer to school. It woudl mean an equity release from our house, getting a bigger mortgage on a new house! i am so scared how the bursary would be then reviewed and if it might affect the bursary. Has anybody had similar scenarios?

Does that mean you will be keeping current house (from which you release equity) and then taking out a new mortgage on a secind property?

Yes I think owning two houses is not compatible with holding a bursary

How on earth do you need a bursary with 2 properties?!

If you can afford two houses then it's morally wrong to claim a bursary.

Equity release is from a property you keep, not sell, like a remortgage. If you can afford a more expensive or second house, then the bursar may well decide you do not qualify for a bursary. Policy may vary but increasing outgoings, having buy to let or holiday homes in uk or elsewhere, expensive cars and holidays may well be issues. If you seek to hide this you could be making a fraudulent declaration. Bear in mind pressure on bursary funds is likely to increase short term.

I think everyone has misread the OP. She clearly says she is selling her current house and using the equity from that sale to buy a more expensive house using a bigger mortgage...

Speak to your bursar but I doubt this would change the financial analysis. You would have the same amount of home equity but your costs would increase due to the higher mortgage debt I assume. Still its worth discussing with the school before making any major financial changes.

Actually op is not that clear , the title suggests a remortgage which would be on existing property to release money for deposit on a second. This is one of several threads talking about investment in property, hence why the confusion.

sorry, i am do not use terminology accurately, i meant selling our house residential and buying a new house but prices are high so it would be a bigger mortgage. for example if current house sells 350,000 a new one would probably be 450,000

If you can afford a bigger mortgage you can afford to pay more of your child's school fees. CF springs to mind....

So you would not be taking any money out of property into cash, just transferring the equity into a more expensive house and taking on a higher mortgage?

It seems very much against the spirit of a bursary tbh and I'm a bit surprised you have the financial room to extend the mortgage while also paying school fees and being in receipt of a bursary. However as long as you have been honest & given up to date info about your financial position, I can't see why increasing your debt would affect the bursary. I would assume it all comes down to individual circumstances though.

Hmm this always makes be dubious. We’ve known of a couple of bursary holders, who did just this. Upgraded from modest to more substantial homes...and it raised quite a few eyebrows..not just mine. One daughter used to brag about their many holidays, with an air of couldn’t care less where the school being aware were concerned. Drove a brand new car in 6th form...and as soon as they had finished school; they sold up and moved into a mansion. So I really don’t think scrutiny is always as thorough as it should be. And it certainly irks that full fee payers like ourselves..live with modest homes and mortgage constraints, because surely that’s how it should be..
However..every case is different of course!

Spare money should go into reducing your 'need' for a bursary so families who genuinely can't afford the fees can have a bursary/a larger bursary and not into buying a larger house.

I'm not saying this applies to OP, but a few families i know who receive bursaries I cannot fathom how they've got one, including no mortgage, only one parent works (everyone's has a choice to work or not to work, particularly when children are older) etc . I think a lot of it comes down to having the front to apply!

I believe bursaries should be for the families who genuinely need them - free school meals, on benefit. Unfortunately these families are not aware or do not have the confidence or the inclination to apply. If OP has the spare money to afford another £100k of mortgage, then surely that should go on school fees, but as long as they are honest, then the school can always say no.

If your financial situation changes, then your need of a bursary changes - one way or another? Don’t you have an annual review? Only your school can help you out with this one, and yes if you talk to them you may find they are not 100% in your favour, which I suppose is why you’re asking here?

Thank you

We did this last year. We moved house, bought for virtually the same price as sold our old home for, but new home was bigger. Obtained an increased mortgage to cover stamp duty and some needed renovation costs. Contacted school before doing any of it to find out what the impact may be on bursary, they had no issue with it. They don't expect you to put your life entirely on hold for the school years.

Yet many full paying parents do put their lives on hold....we have for over 10 years now, and will be for another 7. Any extra spending power goes into the school fee pot, so I don’t see why it should be acceptable really. I had the child of a parent who is on full bursary, exclaim to my child, that our house is so teeny. We live in the same town and I know the average price of a house on their street...is at least 200k more. Hardly seems fair...but they do have a ‘gall’ that not many people would possess.

Mumto2two:

" full fee payers like ourselves..live with modest homes and mortgage constraints, because surely that’s how it should be.." and "they do have a gall".

Thankfully, it's the schools that make their decisions about who to award a bursary and why.

Yes indeed. But not all are as scrupulous as perhaps they should. And I also think that while the income threshold is often more defined & transparent, assets are perhaps not so easily assessed. If someone can increase their mortgage for a bigger house, you would think that should affect a bursary in some way; but clearly it sometimes doesn’t. If a school decides that’s ok, then it’s blatantly unfair for those parents who help fund the pot, and apply their own constraints.

Yes, bursaries are to support those that cannot afford the full fees, not those who choose not to afford the fees by not prioritising them.

It really depends on the school. Lots of schools would have said that since you can afford an extra 100k worth of house you can afford to pay more school fees or if you already had a 450k house they would have said you can sell your house and buyer a smaller one in order to enable you to pay the fees. Others don't look into finances that closely and do things in a much more crude way (e.g. income - essential outgoings (including mortgage) < certain amount => you get bursary).