Can I get a home loan with low income?
It’s a common belief that a lower income means you won’t qualify for a home loan. That’s not always the case. If you receive income from more than just your regular salary, your home loan goals may still be within reach.
Can I use government benefits as income source?
If government payments are your only income, getting a home loan can be more challenging. But some benefits may be considered, including:
- carers allowance
- disability support payments
- long-term pensions (such as war or widow’s pension)
- family tax benefits (Parts A and B)
It really depends on your overall situation.
How to prepare if your income is lower
A lower income can make things tighter, but there are practical steps that can help.
Understand your cashflow
Reduce debt
Save for a deposit
Consider a guarantor
FAQs about getting a home loan with low income
Yes, a lower income does not automatically rule you out. Some lenders may consider your full financial situation, including income from multiple sources, not just your base salary.
In some cases, yes. Certain government payments may be considered, such as carers allowance, disability support payments, long-term pensions and family tax benefits. It depends on your overall financial situation.
You can strengthen your position by understanding your cashflow, reducing existing debt, building consistent savings and preparing a deposit. Each of these steps can help improve how much you may be able to borrow.
Most lenders look for at least a 10% deposit. Building regular savings over time can help you reach this goal.
Yes, a guarantor may help you secure a loan. This is usually a family member or friend who agrees to step in if you cannot make repayments. It is important that both parties understand the responsibilities and seek independent legal advice.
Some lenders consider more than just your base salary. They may review different income sources, your expenses, existing debts and your overall financial position when assessing your application.
Low income? We’re here to help
As a specialist lender, we look at more than just your base salary. We may consider different income sources, including some government benefits.
We’ll take the time to understand your situation and assess your application on its own merits. Our focus is simple. Finding a loan that works for you.
And just as importantly, making sure it’s something you can comfortably afford. You can learn more about how we approach this in our responsible lending practices.
Contributor | Neil Culkin, Head of Credit and Settlements
Neil has a 20-year career in credit provision. At Pepper Money, he oversees the underwriting and credit control of all consumer finance loan applications. He is also responsible for updating lending policies and guidelines.
Published by Pepper Money. Read our Editorial Policy to learn how we create and review content.
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