How Do School Fees Affect Mortgage Borrowing?

Private school fees can be eye-wateringly expensive. If you’re balancing both priorities, you might wonder how lenders treat these fees when deciding how much you can borrow.

The short answer? School fees are often seen as a significant financial commitment and will be factored into your affordability assessment. However, with the right approach and advice, it’s possible to secure a mortgage that fits your circumstances.

In this guide, we’ll break down how school fees affect borrowing, exceptions lenders may consider, and how expert brokers like Strive can help.

How Could School Fees Impact the Amount You Can Borrow?

Lenders assess affordability by looking at your income versus your outgoings. School fees are typically treated as a monthly commitment, even if you pay them termly or annually.

Here’s how they factor into borrowing:

• Added to monthly commitments: The fees are considered alongside other regular outgoings, such as loans or childcare, which can reduce the maximum amount you can borrow.

• Impact depends on disposable income:

• If you have limited disposable income, school fees will likely have a bigger impact.

• For instance, someone earning £50,000 a year with £1,500 in monthly school fees may find their borrowing power significantly reduced compared to someone earning £150,000 with similar fees.

• Other factors matter too: The effect of school fees will also depend on:

• Deposit size

• Loan-to-value (LTV) ratio

• Other financial commitments (credit cards, loans, etc.)

If you have substantial surplus income or a larger deposit, the impact may be less severe.

What If You’ve Already Set Aside Money for School Fees?

Some lenders are willing to overlook school fees if you can prove you’ve set aside sufficient funds to cover them for the foreseeable future. For example:

• Savings or trust funds: If you’ve ring-fenced money specifically for education, this may reduce how heavily lenders factor the fees into affordability.

• Documentation required: Be prepared to provide evidence of these funds.

That said, many lenders will still factor school fees into your monthly commitments, regardless of savings.

What If a Family Member or Someone Else is Paying the Fees?

If a generous family member or friend is covering the cost of school fees, lenders may be willing to exclude these payments from their calculations—but only under certain conditions:

• The payments must come directly from the other person’s account.

• You must not appear to be reimbursing them.

If the arrangement is clear-cut and documented, the school fees may not count against your affordability.

What If School Fees Are About to Stop?

In some cases, school fees are a temporary expense—for instance, when your child is close to finishing their education. Certain lenders may:

• Ignore school fees if they’re due to stop within a pre-determined timeframe (e.g., within six months).

• Require evidence, such as an end date or confirmation from the school.

This can help improve your borrowing potential if school fees are no longer a long-term financial commitment.

How Strive Can Help

At Strive, we specialise in helping clients navigate complex financial situations, including balancing school fees and mortgage borrowing.

Our team understands how different lenders assess affordability, and we know which ones are more flexible when it comes to factoring in school fees. With our expertise, we can:

• Identify lenders who may overlook fees if savings or external payments are in place.

• Work with you to maximise your borrowing potential while ensuring long-term affordability.

• Guide you through the documentation and approval process to make things as smooth as possible.

If school fees are part of your financial picture, let Strive find the right mortgage solution for you.

FAQs About School Fees and Mortgage Borrowing