Can you buy a property on a single income?
Mortgage lenders used to work out the size of your loan based on multiples of your joint – or single – income.
But now they calculate it on what you can afford to pay back each month, which means that rising property prices, or only having one income to take into account, won’t necessarily hold you back.
The best way to increase your choice of mortgages available on a limited income is to use a mortgage broker who can search a wide range of lenders to tailor the deal to meet your individual needs.
Teacher Lois, 25, who works in Nottingham and is buying a new home in Sherwood, used a broker to find the right single income mortgage for her move.
She said: “I looked at buying 18 months ago but it wasn’t possible for me on a single income. Then mortgage rates dropped and things changed.
“I had a ten per cent deposit and had the choice of a two or five year deal and chose two, because I don’t definitely know if I’ll still be in the same house in five years.
“It was a straightforward process. With it being a single applicant there was only one set of paperwork and payslips to process.
“I looked at going with my bank and a few other places but the mortgage broker did a better deal and I felt confident it was the right one.”
Senior mortgage broking manager at The Nottingham, Ben Osgood, said having just one income in the mix was only part of the calculation.
He said: “It’s down to an affordability
assessment on you, your income and outgoings. The lender does take into account reduced costs of living for someone on their own too.
“If you are paying a mortgage on your own, the key thing is to consider income protection a lot more carefully. In case you are unexpectedly out of action you need to have a backup fund or protection in place, in short a plan B.
“When there are two people working they may consider themselves safer if one of their incomes dries up.”
These are the steps you can expect on your path towards securing a mortgage
- A personal case handler will be assigned to see your application through to completion;
- They will give the lender all the documents they need to progress the application;
- The property will be valued;
- You will get a formal offer of a mortgage, which your case handler will check through;
- Your solicitor will carry out the necessary searches;
- A completion date will be arranged to suit you;
- The lender will send the money to your solicitor on the agreed date – and your mortgage is complete.
Click through to read more about The Nottingham's mortgage broker service
, or call 0344 481 0013 to arrange an initial meeting.