Raising Capital to Fund Future School Fees

Raising Capital to Fund Future School Fees

Article by Owen McGill Mortgage Adviser

What was the situation?

A professional couple approached Owen McGill, Mortgage Adviser at LDN Finance, seeking advice on how to raise capital against their £1.2 million home to fund their children’s future school fees. They wanted to put arrangements in place ahead of time to provide certainty for their children’s education while ensuring their borrowing remained cost-effective and flexible for the years ahead.

What was the issue?

The clients required £650,000 in total lending, made up of £200,000 to refinance their existing mortgage and £450,000 to cover future school fees. The priority was to structure the borrowing so the additional funds were available when required, without incurring unnecessary interest costs in the meantime.
This is a scenario our advisers are seeing more often, as families look for effective ways to plan for education costs while maintaining control of their wider financial position.

What was the process?

Drawing on his experience and detailed understanding of lender criteria, Owen identified a lender whose offset mortgage offered the right balance of flexibility and cost control. The structure allowed the clients to deposit the additional £450,000 into a linked offset account upon completion, reducing the balance on which interest was charged.
By ring fencing the school fee funds within the offset account, the lender was able to exclude this element of borrowing from affordability calculations. This strategic approach enabled the clients to secure a competitive rate while retaining full access to the funds when needed.

What was the solution?

Owen arranged a tailored borrowing facility that aligned with the clients’ goals and provided the flexibility they needed. The offset mortgage gave them confidence that the funds for their children’s education were readily available while ensuring their capital continued to work efficiently until required.
At LDN Finance, we continue to see growing demand from clients planning ahead for school fees, university costs and other significant family milestones. Our team specialises in structuring flexible mortgage solutions that align with long-term financial goals, providing clarity, control and confidence at every stage.

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