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Author: Elliott Culley - Director & Mortgage Adviser of Switch Mortgage Finance
Mortgages For Foster Carers
Finding the best mortgages for foster carers can be harder than you would think because all mortgage lenders treat foster care income differently.
There are over 56,000 foster carers in the UK so you would assume all mortgage lenders would treat the income the same.
Is it Hard to Get a Foster Carer Mortgage?
No its not hard to obtain a foster carer mortgage, provided you know which mortgage lender meets your particular needs and circumstances. Some lenders can cap the amount they will use for income and others won’t accept the application if this is your only source of income.
You don’t want to waste time searching around for the best lender wasting time and effort. The best option is to use an expert with knowledge of this particular problem.
Can foster carers get a mortgage?
Yes, foster carers can get a mortgage. Mortgage lenders treat foster carers income differently, so you will want to make sure you apply to the lender most suited to your circumstances.
Mortgage lenders assess your income differently and you will find you can some lenders will offer you a larger mortgage than others.
Most mortgage lenders will want to see a history of foster care income for the last two years, although some lenders are happy with 12 months history.
How is Foster Income Calculated?
This varies lender to lender and is the reason why it is so important to choose the right lender for your mortgage application. Lenders will require evidence of your foster income and will assess the sustainability for the term you have selected.
Some mortgage lenders may cap the amount of income they are willing to use for affordability. Mortgage lenders will treat foster children as dependents which will reduce your borrowing potential.
Do All Lenders Treat Foster Carers The Same?
No, mortgage lenders have different criteria. Some lenders do not take into account foster income at all. You will want to avoid these lenders as they will also treat your foster children as dependents which will reduce your borrowing capacity.
Other mortgage lenders may only take a certain percentage of your foster income or will cap the amount they would use based on your primary income.
Some mortgage lenders will require 2 years history where as others will be happy with a 12 month history.
Some mortgage lenders will not accept the income if this is your sole job and your only source of income.
You want to find a mortgage lender that will maximize your foster care income. We know which lenders offer the best foster care mortgages.
What Foster Care Income Proof Do I Need to Provide?
The majority of mortgage lenders will class you as self-employed. This would mean providing two years tax calculations showing your foster income.
There are some mortgage lenders that will consider your fostering allowance based on the last 6-12 remittance slips.
Speak to an Expert!
Contact us today for expert advice and guidance on your unique mortgage and property needs. We will work with you on a one-on-one to basis to help you find the right solution for your needs.
With our experience you can rest assured that you are in good hands when it comes to securing the financing you need for your property.
Foster carer mortgage calculator
How much you can borrow will depend on how the mortgage lender assesses your income. The below table shows the wide difference there is between lenders.
For the example I have selected 3 lenders with differing assessments of foster income, from 0% all the way through to 100%. The examples assume a household of two adults with no debts and 1 foster child. The mortgage is on a 30 year term with a 5 year fixed product.
| Main Income | Fostering Income | Lender 1 | Lender 2 | Lender 3 |
| £30,000.00 | £22,000.00 | £134,700.00 | £184,000.00 | £233,480.00 |
The table above illustrates the difference between mortgage lenders and the importance in applying to the right lender.
What Evidence is Needed to Use Foster Income?
The majority of mortgage lenders treat you as self-employed and will want to see two years tax calculations and tax year overviews. Some Mortgage lenders will ask you for 6-12 months remittance slips along with bank statements.
You will also need to provide a letter from the local authority or fostering agency to prove your income and how many children you foster.
Can I Get a Foster Carer Mortgage With Less Than 2 Years Proof?
Yes it is possible to obtain a mortgage with foster carer income with less than 2 years proof. There are some lenders that require evidence of around 6-12 months.
You will access to more mortgage lenders the longer you have been a foster carer. A 2 year history of foster care income is asked for by the majority of mortgage lenders.
What Deposit is Needed for a Foster Carer Mortgage?
The minimum deposit currently required is 5% but this does restrict the amount of mortgage lenders available to you. If you can raise a larger deposit, you will have access to more lenders and cheaper rates.
Are There Mortgages for Foster Carers With Bad Credit?
There are mortgage lenders who will consider you if you have some bad credit. Whether you can obtain a mortgage will ultimately depend on your credit history.
How a Broker Can Help You Get a Better Deal as a Foster Carer?
An experienced mortgage broker will know which mortgage lenders will best suit your situation. They will be able to maximise your borrowing potential and make sure no time is wasted in finding you a suitable mortgage. With access to over 90 lenders at Switch we are in a great position where we can approach all the lenders to find you the best deal, so if you want to find out if we can help you then please do get in contact.
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