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Single Parent Mortgages

Getting a mortgage as a single parent can seem like an insurmountable task. But there are lots of options to choose from, even if you’re a first-time buyer.
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Bringing children up as a single parent of course can be very hard, and if you’re thinking of taking a mortgage on top of that, things can seem impossible.

There are over three million single-parent families in the UK, and they often find it difficult to secure mortgages due to their single income. And even if you’re receiving child maintenance, lenders might not take that into account while assessing your application.

Thankfully, it’s very much possible to get a mortgage as a single parent. All you need is proper guidance to land on the right lender. 

So, whether you’re a first-time home buyer or a newly single parent looking to jump onto the property market, this article is just the thing you need to get single parent mortgages.

Are Single Parents Eligible For Mortgages In The UK?

Single parents are very much eligible for mortgages in the UK, and lenders usually don’t discriminate based on marital status. But that’s contingent on your income levels and personal circumstances.

Single parents in the UK usually have lower incomes than households with two parents. They also tend to have low savings levels as they have to manage expenditure on their own; both these factors can impact a single parent’s eligibility to get a mortgage.

Not to mention the fact that rising property prices in the UK have also made it hard to get mortgages due to required higher borrowing levels, this being the case not only for single parents. As a result, many single parents in the UK chose to live in rented accommodations.

But seeing as rent rates are also on the rise, it makes sense to do some calculations and get a mortgage for a self-owned property in many cases if possible. 

What Is The Maximum Amount That A Single Parent Can Borrow?

Mortgage Affordability Chart

As with any mortgage, the amount you can borrow depends on multiple factors, such as income levels, credit history and the amount of deposit you can put down. Any debts or adverse credit signs, such as defaults, will affect the borrowing limits and the available pool of lenders.

Technically, you can get a single-parent mortgage even with a poor credit history. You just have to find the right lender and might need to opt for a higher interest rate and deposit.

What Is Considered As Income For A Single Parent?

When you put in an application for a mortgage, you’ll not just need to consider your salary. Mortgage lenders look at other income sources as well. These might include:

  • State benefits, such as DLA, child benefit, or universal credit. 
  • Child support payment/maintenance
  • Income from savings as interest

These are only some of the possible data points that lenders might look at. They’ll also consider factors such as your monthly spending and savings, the regularity of your child support payments, etc.

Single Parent Mortgages for Self Employed

For single parents who are self-employed, it can be a bit complicated to get a mortgage when compared to if you’re on a regular salary income. If your self-employment income is steady and you have the documents to prove it, then there shouldn’t be any problem.

If you are newly self-employed, then lenders might be a bit reluctant to offer you a mortgage. This is because most lenders aren’t really equipped to properly assess complex self-employed income streams with below 1 years worth of trading accounts.

Lenders may ask for about three years of income statements. You’ll also need to submit your income to the HMRC before putting in a mortgage application.

Usually, lenders will apply a 4.5-6 times multiplier to your income and consider that as the amount you are eligible to borrow. This will vary from lender to lender.

Mortgage Help For Single Parents

Single parents can get help from the following schemes for getting a mortgage in the UK.

1. Family-gifted deposits

Gifted Deposits

If you’re a single parent without any savings, you might be able to get the initial deposit as a gift from willing family members. 

2. Shared Ownership

what is shared ownership

This scheme lets you purchase a percentage of the home and pay rent on the rest. It’s a middle ground between buying and renting that eases the burden and makes the mortgage more affordable

Often shared ownership properties are good for those with lower deposits but higher income levels when taking into account lenders affordability calculations. 

3. Joint Borrower Sole Proprietor (JBSP) Mortgages

Joint Mortgage and Joint Borrower Sole Proprietor

A joint borrower sole proprietor mortgage is a type of mortgage where another party offers their income/personal circumstances to the mortgage application without being named on the deeds . This “other party” is usually a family member in a lot of cases. 

Please note that this method should be chosen responsibly. In case of defaults for example from your end, the other party will be affected adversely and vise versa.

Buying Your Partner Out From A Mortgage

In case you’re coming out of a separation, a situation might arise when your partner wants to be taken out of a joint mortgage. In this case, you would want to buy them out.

You’ll need to contact your lender to understand whether they’re willing to move the mortgage to your name alone. Be advised: this can be a costly proposition and will require you to meet the lenders criteria in your sole name.

If you and your ex-partner have equal contributions to the mortgage, you’ll need to pay off the entire half of your partner’s investment in many cases. Let’s illustrate this with an example.

Suppose your ex and you each paid £15,000 towards the deposit when buying the property. This makes a total deposit of £30,000. 

Now, since you bought it, the property value has increased by £50,000. This means you have a total equity of £80,000 in the property (assuming you’ve paid off just the interest till now for this example to keep it simple).

This means to buy your ex out, you’ll need to give them £ 40,000, which is a substantial amount. In most cases, it might be impossible for a single parent to shell out such a sum or even borrow it on a remortgage as you do not meet the lenders criteria in your sole name. You might even have to consider selling the property in this case.


Discounts Or Benefits For Single Parents In The UK

1. Council Tax Discount 

People living alone or as single parents in the UK have a 25% council tax discount available to them. You can check out this guide on council tax to know more.

2. Child Benefits

This is obvious for single parents, but if your annual income is more than £ 50,000, then you’ll need to pay taxes on this potentially. 

3. Single Parent Universal Credit

Universal Credit is made up of a standard allowance along with extra money for children you have. The usual allowance is £ 335 per month for anyone over 25 years of age. Please note that you can receive universal credit even if you’re working.

Again universal credit levels available will be dependent on a case by case basis. 

Frequently Asked Questions(FAQs)

1. Which Mortgage Lenders In The UK Specialise In Single Parent Mortgages?

There aren’t any lenders exclusively catering to single parents, but most experienced mortgage brokers can help you get a mortgage as a single parent.

2. Can I Get A Mortgage As A Single Parent If I’m On Maternity or Paternity Leave?

Yes, you can. Lenders usually consider maternity or paternity leave pay as part of your income for mortgage eligibility assessments. However, you might need to provide them with proof of returning to work post-leave or evidence of your original income before you went on maternity or paternity leave

3. Do Single Parents Need A Larger Deposit Amount?

There’s no such rule that says this. The deposit amount you need to put down will depend more on your financial status than your marital status.

Your home may be repossessed if you do not keep up repayments on your mortgage.

All content is written by qualified mortgage advisors to provide current, reliable and accurate mortgage information. The information on this website is not specific for each individual reader and therefore does not constitute financial advice.

CeMAP & CERER Qualified Mortgage Adviser

I am CeMAP & CERER qualified mortgage adviser and have helped a number of clients realise their dreams when they thought it would not be possible. I’m skilled at getting mortgages sorted for people with a history of missed payments, CCJs, defaults, debt management programmes, IVAs and bankruptcies.

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