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May 31, 2022

Single Parents Mortgage Guide

Single Parent Mortgage Guide

It’s very true that being a single parent is not easy. If you want to get a mortgage, then you may be convinced that this is going to be impossible. This is not true at all, in fact, it’s very straightforward if you know the process and if you are aware of the help that is out there for you. If you want to know more about the challenges that are out there, or if you want to make sure that you are making the best decisions possible regarding your application, then this is the guide for you. Take a look below to find out “can I get a mortgage as a single parent?”.

Can I Get A Mortgage As A Single Parent?

Mortgage lenders are far more understanding than most people realise. A lender will give money to anyone if they have a good level of assurance that it is going to be paid back. You just have to make sure that you are able to meet the monthly repayments. If you are a single parent, then you may know that proving your financial position can be difficult, but if you know that you can afford the house in the first place, then it is just a matter of proving it. In the UK, there are a huge number of providers who would be more than happy to work with you to make sure that you are getting a fair deal. So, if you’re wondering, can a single parent working part-time get a mortgage? The answer is a resounding yes, but only if you follow the right steps. Keep reading to find out how to get a mortgage as a single parent.

How To Get A Mortgage As A Single Mum Or Dad

How To Get A Mortgage As A Single Mum Or Dad

If you want to get a mortgage as a single mother or father, then you need to understand your financial position. If you have a low income, or if you have no income other than benefits which is typical for a lot of single parents, then this can reduce the amount of money that you can borrow. A lot of providers will loan you four times your yearly salary, so the lower your income, the less chance you have of being able to secure a good mortgage. It’s important to know that your application will depend on the amount of dependents that you have. The more you have, the more your affordability will be impacted, and this will affect how much a lender is going to give you. You will have limitations regarding your income, but you also need to look at your affordability. If your income is low but your outgoings every month are not high, then certain banks may find you more appealing. Use a single parent mortgage calculator UK to work out how viable a mortgage is for you.

If you want your mortgage to be considered, then you need to show your lender that you are able to pay off the loan. While your income may be low, or even non-existent, you may be able to rely on other sources of money. There are also things that you can do to maximise your chances of getting a mortgage, such as hiring a financial advisor. This will make sure that the industry is working in your favour, rather than working against you. You can also hire a mortgage broker for single parents. Find out more about how to get a mortgage single parent below.

The Affordability Of The Mortgage

Affordability is important to lenders. When it comes to your affordability, your lender will look at how many dependents you have, as well as the hours that you work. They will also look at your salary, your extra income and your total expenses. As mentioned above, even if your income is not high, this is not a problem if your expenses are incredibly low. Paying off debt is a great way for you to increase your general affordability for a mortgage.

Can A Single Parent Working Part-Time Get A Mortgage?

Single Parent Working Part-Time Get A Mortgage

One huge factor when it comes to getting a mortgage is meeting the criteria that is set. It is very common for single parents to have to work part-time because they have the responsibility of looking after their child. For this reason, you may find that the amount of money that you can borrow is somewhat limited. A lot of lenders will give you between three and five times your income, as mentioned above. That being said, you have to remember that this number will decrease with the more children that you have. If you have a single child and you try and keep all of your outgoings to a minimum, then you may be able to apply for a much bigger loan. Your income and your outgoings will be known as your income-to-debt ratio. This gives the lender the chance to figure out what is affordable and what is not. It’s important to know that it is possible for you to get a mortgage as long as you are able to meet the criteria.

Will Lenders Consider Tax Credits And Child Benefits In A Mortgage Application?

If you are on benefits as a single parent, then you should know that it is more than possible for you to get a mortgage if you have the right circumstances. Some lenders may only accept a certain percentage of your benefits and some lenders will not accept any of your benefit income at all. The best way for you to find out once and for all would be for you to try and speak with a lender as they can advise you on the best way for you to go about your application. If you want to see which benefits are largely accepted as income, then take a look below.

  • Carer’s Allowance
  • Child Benefit
  • Attendance Allowance
  • DLA
  • Industrial Injury Benefit
  • Incapacity Benefit
  • Pension Credit
  • Maternity Allowance
  • Widow’s Pension
  • Severe Disability Allowance
  • Child Tax Credit (sometimes)
  • Housing Benefits (sometimes)

Secure A Deposit For Your Mortgage

In most cases, you do have to make sure that you have some kind of deposit. A lot of lenders will offer you a mortgage but you need to make sure that you have at least 5%. If you have a bigger deposit then this will open up even more benefits for you, such as lower interest rates. You will also be able to pay off your mortgage way faster, which is incredibly beneficial if you know that you do not have a lot of working years left, or if you intend to move up the property ladder quickly.

Manage Your Credit History Effectively

It’s very important that you have a good credit history if you intend to apply for a mortgage. Lenders will want to know about your credit history when you choose to apply for your mortgage application. If the lender can see that you pay all of your credit cards on time and that you do not go too close to your ceiling limit, then this will help you out a lot in the long run. If you have a good credit history, then you may be offered a more favourable deal. If you have a bad credit history, then you may find that you are not given as many options when it comes to lenders and that you have to pay a higher interest rate. The main reason for this is because it will help the lender to decrease the risk that they are exposing themselves to.

Is There Single Parent Mortgage Help Available?

Yes, there is a lot of single parent mortgage help out there if you want to apply for a single parent mortgage. In the UK, it may be that you can be given a gifted deposit, or that you can explore the Help to Buy scheme. You can also look into shared ownership, a family mortgage or asking someone to be a guarantor. Take a look below to find out more about mortgages for single mums.

Gifted Deposit

This is when someone gifts you a chunk of money to pay for your deposit on your new home. They will have to sign a form saying that the deposit does not need to be paid back and that they hold no right to the money after it has been put down on the property.

Help to Buy Scheme

The Help to Buy scheme is run by the government and it allows you to get on the property ladder as a first-time buyer. You just need to have a 5% deposit. You can then borrow up to 20% of the purchase price and this is interest-free for 5 years. You only have until March 2023 to take advantage of this.

Shared Ownership

Shared ownership gives a buyer the chance to purchase part of a home. The percentage of ownership is usually between 25% and 75%. You will pay the mortgage on the part that you own and then rent on the rest.

Family Mortgage

This is an arrangement that can support the purchase of a property by using security which is given by the family. This eliminates the need for a loan or a gift.

Guarantor

If you have a low income, then a guarantor could be a good option. It means that if you cannot pay your mortgage, someone can step in to pay it for you. They are legally liable to cover the payments if you do not. This is a great gateway to getting a mortgage as a single mum.

Got More Questions About Securing A Single Parent Mortgage?

Do you have any more questions about getting a mortgage as a single parent? Then the best thing that you can do is contact a broker. When you do, they can then give you the advice you need. Get in touch with our team if you are interested in getting single mum mortgage help from our team.

YOUR HOME MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON YOUR MORTGAGE

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YOUR HOME MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON YOUR MORTGAGE
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