Heritable Bank promotes student buy-to-lets

Demand for university accommodation is also growing and Heritable Bank explains how a buy-to-let purchase ensures the student has safe, comfortable accommodation as well as offering an investment option.

The Bank’s student buy-to-let scheme offers up to 100 per cent funding based on 85 per cent funding on the student property and the equity guaranteed by a charge over the parent’s own property.

It offers funding for properties that other students can also occupy to provide income to support the mortgage while the property can be purchased in either the student’s or the parent’s name. Heritable also provides an overview of the tax implications and details the pros and cons in both situations.

Alison Walley, marketing manager at Heritable Bank, said student buy-to-let was a sector that it was particularly able to help with. She said: “Some lenders won’t look at buy-to-let since regulation as it is an unregulated market.

“We feel we can add value to the buy-to-let proposition. Borrowers think of buy-to-let and are unsure of tax implications and we can help them make the right decision.”

Kevin Morgan, managing director of Consilium Financial Planning, said that student buy-to-let has been happening for years and although it may be a good investment, it should be treated with caution.

“I can see the logic of it but it needs careful thought. While one hopes that after the student finishes university the asset will have appreciated enough to pay off debts, caution needs to be taken,” he explained.