Here at Mortgage Bridge, we get it—trying to get a mortgage on a low income can feel impossible. Lenders have strict criteria, and you might feel like homeownership is out of reach. But don’t stress! There are options out there, and with the right approach, getting a mortgage on a lower income is totally possible.
In this guide, we’ll walk you through everything you need to know, from mortgage types to boosting your chances of approval. Whether you’re a first-time buyer, self-employed, or dealing with bad credit, we’ve got your back.
What Mortgage Options Are Available If You’re on a Low Income?
If you’re on a lower income, you need to know what mortgage options are out there. Lenders focus on affordability, but different types of mortgages and government schemes can help make buying a home more realistic.
Should You Go for a Fixed-Rate or Variable-Rate Mortgage?
Your first big decision is choosing between a fixed-rate and a variable-rate mortgage:
- Fixed-rate mortgages – Your interest rate stays the same for a set period (usually 2, 5, or 10 years). This makes budgeting easier since your payments won’t change.
- Variable-rate mortgages – Your interest rate can go up or down depending on market conditions. This could mean lower payments sometimes but also the risk of them increasing.
If you’re on a lower income, a fixed-rate mortgage can offer the stability you need to manage your monthly budget.
Are There Government Schemes That Can Help?
Yes! There are several schemes designed to help people who might struggle to get a mortgage on their own:
- Shared Ownership – You buy a percentage of a property (usually 25%-75%) and pay rent on the rest. Over time, you can increase your share if your finances improve.
- First Homes Scheme – Aimed at first-time buyers, this scheme offers homes at a discount (often 30% less than market value) to make homeownership more affordable.
- Help to Buy Equity Loan (limited availability) – If you have a small deposit, this scheme provides a loan to boost your deposit, making it easier to get a mortgage.
Could a Guarantor Mortgage Work for You?
If you have a family member who’s willing to back your mortgage, a guarantor mortgage could be a great option. This means they agree to cover your payments if you can’t, which makes lenders more likely to approve you. If you’re wondering “Can I get a mortgage with a low income?”, this could be a game-changer.
How Can You Boost Your Chances of Getting a Mortgage on a Low Income?
Getting a mortgage on a lower income isn’t just about finding the right lender—it’s also about making yourself look as strong as possible on paper. Here’s what you can do:
1. What Credit Score Do You Need for a Low Income Mortgage?
Your credit score is a big deal. It tells lenders how reliable you are with money. Here’s how to improve it:
- Pay off debts on time
- Keep credit card balances low
- Check your credit report for errors
- Avoid applying for too much credit at once
If you’re thinking “Is my credit score good enough to get a mortgage on a low income?”, the answer depends on the lender. But improving it always helps!
2. How Much Deposit Do You Need?
The bigger your deposit, the less risk you are to lenders. Even saving an extra 5% can open up better mortgage deals. If you’re looking for low deposit mortgage options, start saving as much as you can.
3. How Can You Lower Your Debt-to-Income Ratio?
Lenders check how much debt you have compared to your income. Paying off things like credit cards, loans, or car finance can make a big difference.
4. Is a Joint Mortgage an Option?
If your income isn’t enough on its own, applying with someone else—like a partner or family member—can boost your chances. If you’re wondering “What’s the minimum income needed for a mortgage?”, a joint mortgage might be the answer.
5. How Can You Prove Your Income to Lenders?
Lenders love stability. The more proof you can provide of a steady income—like payslips, tax returns (if self-employed), or bank statements—the better your chances.
What Are the Biggest Challenges to Getting a Mortgage on a Low Income?
A lot of people worry about the barriers to getting a mortgage, but there are always ways around them.
Can Self-Employed People Get a Mortgage on a Low Income?
Absolutely! If you’re self-employed, lenders will want to see:
- Your last two or three years of tax returns
- Your business accounts
- Bank statements showing steady income
Some lenders specialise in mortgages for self-employed buyers, and as mortgage brokers, we can help you find them.
Can You Get a Mortgage with Bad Credit and a Low Income?
Yes! Some lenders cater specifically to those with bad credit, though you might need a larger deposit or pay a slightly higher interest rate. If you’re thinking “Can I still get a mortgage with bad credit and low income?”, the answer is yes—with the right approach.
What If You Have No Credit History?
No credit history can be a problem, but there are ways to build it up. Using a credit card responsibly, taking out a small loan, or even paying your mobile phone bill on time can help.
Why Should You Use a Mortgage Broker Like Mortgage Bridge?
Let’s be real—finding a mortgage on a low income can be tough. That’s where we come in.
How Can We Help?
- We have access to specialist lenders – Some lenders are more flexible with low incomes, bad credit, or self-employed applicants. We know who they are.
- We give tailored advice – No two situations are the same. We’ll find the best mortgage for your circumstances.
- We save you time and stress – We handle the paperwork, compare lenders, and negotiate the best deals.
- We improve your approval chances – We know exactly what lenders are looking for and help strengthen your application.
Final Thoughts: Can You Get a Mortgage on a Low Income?
Yes, you can! It takes planning, improving your financial situation, and sometimes a little expert help. But homeownership is definitely within reach.
At Mortgage Bridge, we specialise in helping people with bad credit, low incomes, and unique financial situations. If you’re unsure where to start, get in touch with us today—we’d love to help you make your homeownership dreams a reality!