Applying for a loan using my PhD Scholarship + casual work wage

Hi community,

Has anyone had experience with applying for a home loan using PhD Scholarships?

My situation:
Receiving 29,950 annual scholarship, which is 2500/month approximately
Doing a casual work earning a wage of 1500/month

Looking to apply for a loan of 350,000-400,000 for my first PPR. Haven't approached a broker yet, but wanna know what does the community think. Thank you.

James.

 

I was knocked back 10 years ago, but times may have changed. Problem is not all candidates finish their PhDs, and many aren’t able to secure full time gigs afterwards.

 

You've asked the wrong question. Anyone can apply, but would it likely to be approved? Prob not as short term - but I haven't checked so best to get some specific credit advice

 

I did one very similar, I was actually surprised the bank accepted it as the PHD stipend only had ~6 months left on it at settlement. The bank approved it on the basis that she would get a job paying significantly more once she has completed her PHD.

If your PHD is in french literature perhaps the bank would take a different view on your post PHD employability

It will also come down to how much of a deposit you have, a bigger deposit = more chance of being approved.

 

Yes you can, there are lenders taking 100% of the scholarship income then apply tax at the marginal tax rate (combined with the Casual income)
BUT even with the Scholarship income your serviceability for a $350K loan is going to be very tight, Debt To income ratio will be >7
If no other debts, it might be possible, would need to run the actual numbers though to give any kind of certainty.
Would need to show evidence of a minimum 3 months scholarship income and 6 months casual income

 

Yes you can, but all banks will treat your scholarship differently.

Also how long have you been casually employed for ? If more then 6 months then it will put you in a better position.

Assuming you're borrowing 80%?.

 

Hi Tony,
Thanks for your response. I have just finished my full time employment and started my casual work. Its complicated, but I should have get a loan while I was still employed full time.

Yes I am borrowing 80%. and do I have to provide a six month casual job pay record?

 

Hi Lindsay,
Thanks for your response. In fact I have just quit my full time job and started a casual employment with the same employer. Do I really have to wait for six month of casual payment record?

If I am only borrowing using my scholarship, would the bank accept it? I understand that the borrowing capacity would surely drop.

 

I was alreadying working in the industry and decided to do a PhD, I am confidnent to find a job even I didn't finish my PhD. Would the bank believe that I would still be able to find a job and pay and morgage?

 

The stipend would be running for 3.5 years starting from now.
I was already a practicing engineer before my PhD. So the future shouldn't be worse than what I am at now.

 

1) Unfortunately 6 months for causal income even with same employer is the industry standard, banks don't like casual. Typically (but not always) casual employees are first ones to be let go or have hours reduced if the business struggles.
2) Without the additional income from employment it won't work for a $350K lend, plus DTI would then be >10
Serviceability on $30K per annum might get you around $200K MAX (off the top of my head)

 

The banks will annualised your 6 months salary over 12 months.

You'd need to provide your first payslip to confirm youve been there for more then 6 months

Since you're borrowing 80%, you'll have a few more choices with lenders.

 

Cool, not sure what I can do with 250,000 (200,000 loan plus 50,000 savings), I don't think that would get me any property in metro area Melbourne. GG

 

Agree. The budget issues with uni's and research etc may be a factor to consider. Can they cancel the project with notice ? Unis are slashing costs and everything is likely on the table.

I have a client doing one at Oxford Uni. They were given a choice some time ago...Move to the vaccine team or lose the funding. The vaccine team funding is massive and they now get paid even more despite it not being their primary focus (animal medicine). Now working on delivery methods incl tablets, capsules, nasal spray, patches etc. Sort of like WW2. Anyone with certain skills was "drafted" to the national interest and anything else was suspended.

 

As Lindsey has mentioned, you will likely only get a loan for $200k.
If I were you, I would focus on completing the PhD (it takes a lot of resilience). In the meantime, use the time to save as much as you can, research on where you want to buy, property cycles etc.,
This way, you are ready to jump when you have the borrowing capacity.

 

Thanks Shazz.