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If you are on benefits, it is still possible to qualify for a mortgage however your application approval will depend on multiple factors. For example, you may need to demonstrate that you have additional income or assets. Additionally, you may need to work with specific mortgage lenders who can understand your personal needs. Finding a mortgage lender that understands your needs and can cater to your personal circumstances is therefore key.

What Are UK Benefits?

Benefits in the UK are a type of government payment which help those on low incomes or people that need extra funding for specific needs. There are several types of benefits and tax credits available in the UK. For example, Universal Credit, Child Tax Credit or even Disability Seekers Allowance to name a few. Millions of UK citizens are on benefits, for various reasons whether it be a disability, child support or due to loss of employment.

Can I Get a Mortgage If I’m on Benefits?

You can still get a mortgage if you are on benefits under certain circumstances. In order for your mortgage application to be approved, you will probably have to demonstrate additional income or assets. The exact lending criteria will depend on the lender that you decide to work with. For example, some lenders may only accept a capped percentage of your benefit income and other lenders may not even work with applicants who are on benefits.

Choosing a UK mortgage lender who understands your specific financial circumstances could help you get the most suitable loan at the best rates – if you work with a mortgage broker or comparison site, you could find the most appropriate lender. Brokers can help you find lenders that definitely accept applicants on benefits and can also help you with the paperwork and negotiate rates on your behalf.

What Mortgage Amount Can I Take Out If I’m On Benefits?

Regardless of whether or not you are on benefits or not, the amount you can borrow for a mortgage is usually dependent on your overall income and will also vary between lenders. Your overall income could be made up of traditional employment, benefits, a combination of the two, or from combined incomes if you are applying for a mortgage with someone else. Not only that, but it will depend on the value of the property.

The amount that you are able to borrow will also depend on your existing debt, including any credit card debts or other loans; if you already have a high amount of existing debt, it is unlikely that you will be approved for a large mortgage amount.

If you have bad credit, this could also negatively impact your chances of being approved for a mortgage and could mean less favourable rates.

What Kind Of UK Mortgage Am I Eligible For If I Am On Benefits?

There are many different mortgage products on the market with many different options for payment (such as interest-only, fixed rate and variable). In order to find the best mortgage to suit your specific needs, it could be useful to work with a mortgage broker. They can save you the time and effort of shopping around and could potentially save you the disappointment of being rejected for a mortgage from an unsuitable lender.

Even if you are on benefits, there will be several mortgage options available to you, especially if you are able to guarantee long-term repayment by demonstrating additional income or assets.

You may even be eligible for buy-to-let mortgages with certain lenders, even if you are on benefits. However, depending on the lender, you may face stricter affordability criteria and your pool of available lenders may be smaller.

How Does Being On Benefits Impact My Mortgage Application?

If you are on benefits, it could mean that your choice of lenders is fewer as not all mortgage providers will work with those on benefits. It could also meant that you face stricter lending criteria; lenders will want to confirm that you can afford to repay your mortgage and that your income is stable and high enough to guarantee payments. As long as you can prove this, there is no reason why you should not be approved for a mortgage while on benefits and continue to buy a property.

For more information on mortgage applications and insights, feel free to contact the ProperEaze team today where we are more than happy to discuss your options.