Parenting a child single-handedly without anyone’s help is a tough job. You have to accept both personal and financial responsibilities. Managing finances with a single income is a huge challenge.
Besides, purchasing a home is a huge responsibility. Lenders might consider your status as a single parent as your drawback. They may even turn down your request for loans.
But if your financial condition is ready to bear the burden of loan repayment, you have a fair chance of getting approval. Loans for single mothers can make your life easy only when you are a permanent resident of the UK.
So, it is not true that you cannot get an opportunity to fetch loans for the home purchase. But it is more like your financial responsibility will increase. Above all, you have to show enough income to match up with the repayment expectation of the lender.
Low income can pose an impediment to getting a loan. But you have to worry less if you approach the right lender. This guide lets you quickly point out ways to triumph over your restriction. So, read it carefully.
Difficulties you may face
First of all, the affordability factor is the prime concern of lenders offering a mortgage. So, it does not mean that being a single parent, you are not eligible to get loans for the home purchase.
You will not find any separate loan intended for single parents. In short, you have to fit the criteria set by the lender in order to be able to get approval for loans.
The biggest challenges that might come in your way could be:
- Finding the appropriate lender
- Getting pocket-friendly prices
- Fetching loan money with the flexible repayment plan
So, if your income is on your lower side, you can face these problems while approaching a lender.
Recommendations to help you overcome the difficulties
If owning a home is your priority right now, you have to think of ways your financial profile can earn more weightage at the time of buying a property. Given below are a few things you should think upon. These are:
Total income
You might feel disappointed to see your income not covering the repayment. But don’t count your salary as your only income source. Other earnings that you should include are:
- Child benefits
- Tax credits
- Child support
- Part-time income etc
However, doing only this might not be enough to convince the lender. With enhanced income, you can definitely borrow more. Whether or not you will get approval will depend on the affordability parameter set by the lender.
Expenses
The lender will show concern for your expenses also. They will like to validate your ability to repay by determining your outgoings. You are a single parent and have to manage all the individual expenses on your own.
So, you should try to minimize expenses to showcase your improved repayment capacity to the lender. It can positively impact your scope of getting approval for the mortgage.
Debts
It is very difficult to handle expenses with a single income. At times, payments might get delayed due to cash shortages. This type of situation might often lead to the formation of debts.
Although lenders hold a practical approach while dealing with single parents, you have to make sure your debts are in control. Your financial condition should be balanced so that the lender can ascertain your repaying possibilities.
Finding a lender with critical financial problems like bankruptcy is tricky. Nevertheless, you have to dive deeper to locate a lender who can be a perfect match for your situation.
Managing time
As a single parent, you have to pay attention of lot more things other than finances. Amidst all these, you might not get the time to discover mortgage alternatives. However, if buying a house is an urgent requirement in your life, you have to manage time from busy chores.
It might be difficult but not impossible. You can even seek the assistance of your family members to help in completing other parental tasks. It would help you extract some time from a day to look for and complete loan applications.
Deposit
Many lenders would ask you to deposit an amount before approving mortgage. This factor can enhance your chances of getting approval. But you should be in a position to meet the deposit requirement.
Ask your family members for help
Your family members are well versed in your situation. They know what you went through and how you manage everything on your own. There is a possibility that they might get ready to help you to get a mortgage.
It does not matter how they will react. But you should at least try to approach help for some financial assistance.
Assistance from government
You can take advantage of various schemes that the Government offers. The three schemes are mortgage guarantee scheme, help to buy equity loan, and shared ownership.
The first option will let you purchase a house with a 5% to 9 % deposit. The second one will allow you to get a house with at least a 5 % deposit. The last one will enable you to purchase a portion of a home.
Examining the three schemes, you must decide which suits you best. The government schemes should be preferred if you don’t have the convenience of getting support from the family.
Every option has some limitations. You have to study and compare them before selecting one.
The bottom line
Don’t think that as a single parent, you will not stand a chance to get a mortgage while purchasing a home. You have to search for flexible terms. Besides, you have to work on ways of enhancing your chances.
To make your financial condition stable, you would definitely need to find a permanent source of income. But meanwhile, you can rely on 12-month instalment loans to pursue expenses.
You can overcome any financial challenge if you remain focused. Implement smart tips and tricks shared in this guest post. You have to determine how you can strategize your finances so that you can purchase the home without facing much exertion being a single parent.