Mortgages For Single Parents UK

By Kristian Derrick

Last Reviewed: 14th December 2023

According to the Office for National Statistics, out of 19 million families in the UK in 2022, 2.9 million of them are single parent families.

That means 2.9 million single parents are faced with deciding on living arrangements based on one salary.

As a single parent faced with growing bills and living expenses and just one salary to live on, you may think it’s impossible to get a mortgage, but this is not always the case.

With the right advice and guidance, you can apply for a mortgage and will likely get approval if you meet the lender’s requirements.

While being a single parent is challenging, it shouldn’t deter you from living a full life, complete with the home you want your children to grow up in.

One thing to be aware of is that affordability assessments apply to single parent mortgages, and without the right approach or knowing which mortgage companies to approach; it may prove challenging to meet the requirements of these checks.

Every lender has its own unique requirements, which means that some are more lenient on certain types of lenders and their requirements.

With the help of a mortgage advisor, you can find out who to approach and how to prepare your application for the best possible outcome.

Passing Single Parent Affordability Assessments

Meeting the lender’s requirements is vitally important when applying for a mortgage as a single parent.

Single parents typically are on the back foot when it comes to affordability as they’re on a low income, have higher expenses than couples, or work part-time.

Mortgage lenders limit how much they provide, regardless of whether the application is for a single person or a joint application.

This is usually between three and five times the applicant’s annual income.

However, some lenders will reduce the amount they allow depending on how many children the applicant has.

Of course, this isn’t discriminatory but based on the expected higher outgoings of a single parent with many children. Affordability is at the heart of every approved mortgage.

That said, there is no guarantee of how a mortgage provider will respond to an application.

Some single parents who manage to keep their monthly outgoings very low may be able to apply for a higher mortgage amount than a single parent with the same number of children but a higher monthly outgoing.

An overview of your financial situation will be carried out to determine your debt-to-income ratio, which will indicate whether you can afford the mortgage you’re applying for.

Can I Use Tax Credits or Child Benefits as Income Towards Single Parent Mortgage Applications?

If you’re a single parent, you may be on some kind of benefits and wonder if you can use these towards proving your income for your mortgage application.

Many single parents assume that benefits can’t count towards income, but they can.

In fact, adding proof of benefits and additional income can bolster your application.

Single parents can use the following as part of their proof of income:

  • Tax credits
  • Maintenance contributions from an ex-partner
  • Child benefit payments
  • Full time or part-time work income
  • Universal credit

As all lenders have unique terms and restrictions, some may have “rules” on how child benefits can be used towards income.

As an example, some mortgage providers won’t allow you to use your child benefits as a form of income if you earn more than £50,000 or if your children are older than 13.

In some instances, some mortgage lenders won’t accept universal credit or tax credits as a suitable form of income.

Mortgage providers will take your income, additional income sources, credit history, and outgoings into consideration before determining if you’re a suitable candidate for a mortgage and just how much you’re eligible for if you’re approved.

Which Mortgage Types are Best Suited to Single Parents in the UK?

Of course, no mortgage provider offers a mortgage specifically for single parents.

But there are several types of mortgages that may be best suited to single parents. Some of these include:

  • Shared ownership schemes – If you don’t have enough deposit to get a mortgage to cover the full cost of a home, you may reduce your spend with a shared ownership scheme. This is a type of mortgage based on a part buy, part rent basis offered by the government. Eligible applicants can buy 25% to 75% of the home from a local council or housing association.
  • Guarantor loans – If a friend or close family member is willing to sign as a guarantor on your mortgage, lenders may provide a better interest rate or provide a higher mortgage amount. The risk is lessened for you, but the guarantor takes on higher risk.
  • Family springboard mortgages – These mortgages generally require the applicant to pay a 0% deposit but require savings held in a savings account for five years that are at least 10% of the property’s value. After five years, the savings are returned to your family members with interest.
  • Gifted deposit mortgages – Some lenders will accept a deposit that doesn’t come from your own savings if you can prove that you were gifted the money from a family member and aren’t required to repay the amount.

While these are all great options for single parents, there are many other types of mortgages available that may suit your situation better.

Chatting with a qualified mortgage advisor may help you determine which mortgage type is best suited to you.

Complexities of Applying for Single Parent Mortgages

Applying for a single parent mortgage can be complicated, especially when it comes to providing affordability.

Approaching mortgage providers individually can result in wasted time, multiple rejections, and a tarnished credit score.

To avoid approaching lenders that can’t help you in your specific scenario, it’s best to chat with a mortgage advisor.

A professional mortgage advisor can help you prepare your application and ensure you only approach mortgage providers likely to consider your application seriously.

Call us today on 01925 906 210 or contact us to speak to one of our friendly advisors.

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