Are there any lenders who take social welfare into account?

Benny122

Hi I am earning €27k a year and my partner is on a Social Welfare Scheme is there any institution that will take his earning into account for a mortgage?

Also if we buy a property together and this is our primary residence will this effect his Social Welfare Scheme?

Would I be better off to get the mortgage in my name and buy the property and have him contribute and make a will to him once the sale is complete

MarkAnthony

I *think* KBC took my BTEA into consideration but I might be wrong. I was also working PT.

Jen44

I just know about childrens allowance as i recently got a mortgage, BOI will consider it as an earning KBC will not, Id say your best bet is to give the banks a quick call or use the chat now service on their websites to get a quick answer regarding different social welfare payments

phormium

I thought no bank could include childrens allowance as income for the purpose of lending?

Banks in general will not take a means tested social welfare payment into account, some chance depending on bank policy on long term benefits such as invalidity or carers.

Eric Cartman

I most certainly hope not. Social welfare payments are not an income source in the traditional sense and it would seem like bringing up your partner on the application may even hurt. A partner on SW would be a dependent in some institutions book.

MarkAnthony

Eric Cartman wrote: »

I most certainly hope not. Social welfare payments are not an income source in the traditional sense and it would seem like bringing up your partner on the application may even hurt. A partner on SW would be a dependent in some institutions book.

Why shouldn't someone on BTEA or carer's allowance etc. be allowed to use that money, which is designed to facilitate day to day living, to purchase their own home rather than rely on renting and paying someone else's mortgage?

pwurple

MarkAnthony wrote: »

Why shouldn't someone on BTEA or carer's allowance etc. be allowed to use that money, which is designed to facilitate day to day living, to purchase their own home rather than rely on renting and paying someone else's mortgage?

Because we don't want people getting into a poverty trap where they feel they can't get off SW because they have a mortgage depending on it?

Because social welfare rates can change, drop or dissappear altogether in a budget. It's not a guaranteed income.

And because the working taxpayer would get pretty feckin miffed when people on SW can get a mortgage, but they can't.

Jen44

phormium wrote: »

I thought no bank could include childrens allowance as income for the purpose of lending?

Banks in general will not take a means tested social welfare payment into account, some chance depending on bank policy on long term benefits such as invalidity or carers.

BOI definitely included it on our application as an added income. I had never even considered it, it was them who asked us if we were receiving childrens allowance and added it in as another source of income. We went with KBC in the end and they didn't include it as an extra income

jeamimus

Benny122 wrote: »

my partner is on a Social Welfare Scheme

Surely, because its a scheme, it's short term or time limited and presumably designed to help him get a job. Once he's off the scheme for a while his income can be included.

Mrs OBumble

^^^ This. Get a job. Problem solved.

Gumbo

phormium wrote: »

I thought no bank could include childrens allowance as income for the purpose of lending?

Banks in general will not take a means tested social welfare payment into account, some chance depending on bank policy on long term benefits such as invalidity or carers.

I was told this by 3 banks in April 2015 also. Ulster Bank, KBC and PTSB. In fact, you are better off hiding the Childrens Allowance from them as they will deduct approx. €400 per month per child from your disposable income.

MarkAnthony

pwurple wrote: »

Because we don't want people getting into a poverty trap where they feel they can't get off SW because they have a mortgage depending on it?

Because social welfare rates can change, drop or dissappear altogether in a budget. It's not a guaranteed income.

And because the working taxpayer would get pretty feckin miffed when people on SW can get a mortgage, but they can't.

Point 1 - I really dont understand. How is someone paying a €600 mortgage worse off in the poverty trap than someone paying €1200 rent, probably being covered by rent allowance?

Point 2 - Ya reckon a job is more stable?

Point 3 - I'd be very happy as a taxpayer to not be paying any rent allowance for people.

Social welfare does not equal dole. There are various schemes that supplement people's income in the short/medium or long term.

jeamimus wrote: »

Surely, because its a scheme, it's short term or time limited and presumably designed to help him get a job. Once he's off the scheme for a while his income can be included.

Social welfare does not equal dole. There are various schemes that supplement people's income in the short/medium or long term.

Mrs OBumble wrote: »

^^^ This. Get a job. Problem solved.

You've been rather flippant here so you'll excuse me retorting in kind. In my personal circumstances I had a good job paying the guts of 50K a year, I lost said job in the bust and after a period of unemployment was granted (and I thank the state and taxpayers of which I was and am once again) the BTEA. I then also took on a PT job when one became available and applied for a mortgage with my wife.

So you'll forgive me for blowing a raspberry in your general direction when you've not really thought through what you're on about.

pwurple

MarkAnthony wrote: »

Point 1 - I really dont understand. How is someone paying a €600 mortgage worse off in the poverty trap than someone paying €1200 rent, probably being covered by rent allowance?

You can stop paying rent with a few weeks notice if your circumstances change. Maybe you get a new (or better) job in Derry, or your medical needs change, but you rent in Cork. Off you go. You cannot do that with a mortgage. So you get stuck in an area where you can't work, with a massive debt hanging around your neck. Trap.

MarkAnthony wrote: »

Point 2 - Ya reckon a job is more stable?

Yes. And it's easier to get another job once you already have one.

MarkAnthony wrote: »

Point 3 - I'd be very happy as a taxpayer to not be paying any rent allowance for people.

Sure we all would. Hence I certainly wouldn't make it any worse by tying a mortgage to social welfare income as well. You'd cripple people financially when the interest rates rise.

astrofool

MarkAnthony wrote: »

Point 1 - I really dont understand. How is someone paying a €600 mortgage worse off in the poverty trap than someone paying €1200 rent, probably being covered by rent allowance?

Point 2 - Ya reckon a job is more stable?

Point 3 - I'd be very happy as a taxpayer to not be paying any rent allowance for people.

Social welfare does not equal dole. There are various schemes that supplement people's income in the short/medium or long term.



Social welfare does not equal dole. There are various schemes that supplement people's income in the short/medium or long term.



You've been rather flippant here so you'll excuse me retorting in kind. In my personal circumstances I had a good job paying the guts of 50K a year, I lost said job in the bust and after a period of unemployment was granted (and I thank the state and taxpayers of which I was and am once again) the BTEA. I then also took on a PT job when one became available and applied for a mortgage with my wife.

So you'll forgive me for blowing a raspberry in your general direction when you've not really thought through what you're on about.

Because the state will cover the rent, or the tenant can move at a moments notice to cheaper accommodation. A mortgage is a multi-year commitment to pay a private institution that should not be taking risks lending to people on state supported welfare which may reduce or disappear in a budget (it essentially becomes a sub-prime mortgage, the type of which required the banks to be bailed out across the world).

L1011

MarkAnthony wrote: »

Why shouldn't someone on BTEA or carer's allowance etc. be allowed to use that money, which is designed to facilitate day to day living, to purchase their own home rather than rely on renting and paying someone else's mortgage?

Because someone on BTEA is in full-time education, for starters.

BTEA specifically is not statutory and could be stopped in the morning if the DSP felt like it.

c montgomery

MarkAnthony wrote: »

Why shouldn't someone on BTEA or carer's allowance etc. be allowed to use that money, which is designed to facilitate day to day living, to purchase their own home rather than rely on renting and paying someone else's mortgage?

Paying someone else's mortgage!!
Jesus wept, are you paying someone else's mortgage when you buy a pint or go out for dinner too?

MarkAnthony

pwurple wrote: »

You can stop paying rent with a few weeks notice if your circumstances change. Maybe you get a new (or better) job in Derry, or your medical needs change, but you rent in Cork. Off you go. You cannot do that with a mortgage. So you get stuck in an area where you can't work, with a massive debt hanging around your neck. Trap.

At the very least the exact issue someone losing their job would face.

pwurple wrote: »

Yes. And it's easier to get another job once you already have one.

Again you're confusing social welfare with the dole.

pwurple wrote: »

Sure we all would. Hence I certainly wouldn't make it any worse by tying a mortgage to social welfare income as well. You'd cripple people financially when the interest rates rise.

Again this applies equally to a renter. If interest rates rise, given that the majority of Dublin LLs are one offs with mortgages rent will also rise. If you have a functioning property market a loss of any income can be offset against the proceeds of sale of the property, be that by the owner voluntarily or by the bank if needed.

astrofool wrote: »

Because the state will cover the rent, or the tenant can move at a moments notice to cheaper accommodation. A mortgage is a multi-year commitment to pay a private institution that should not be taking risks lending to people on state supported welfare which may reduce or disappear in a budget (it essentially becomes a sub-prime mortgage, the type of which required the banks to be bailed out across the world).

More kneejerk nonsense. Social welfare is as stable as any job, in fact much more so.

L1011 wrote: »

Because someone on BTEA is in full-time education, for starters.

BTEA specifically is not statutory and could be stopped in the morning if the DSP felt like it.

See above, and also why should someone in full time education not buy a property. I bought my first place at 19 when I was at uni, hence I could afford the deposit when the latest move rocked around.

MarkAnthony

To avoid a huge amount of back and forth let me clearly state my position here. Most of what I'm reading above is, IMO, a knee jerk reaction to two things. i) The crash ii) People not being able to afford a place now themselves.

On point i) it wasn't bank's lending an extra 10K on the basis of a €188 BTEA payment it was banks lending €500K on the basis of a €40K a year salary.

On point ii) Assistance should be there for all who want to purchase a home and can afford to do so. Anyone who is currently renting in Dublin is able to afford to do so. It's utter nonsense to suggest:

a) Social welfare is any less stable than any private sector employment
b) people who can't save up deposits in the current climate are irresponsible

As for any jealousy that someone is receiving income supplements from tax, that's a deeper issue which I'm sure would be better suited to a different thread.

Regardless of anything else there are a number o banks that do accept various social welfare payments, rightly so IMO, there are a few that don't - I'd suggest banking there if you're that bothered about it.

c montgomery

MarkAnthony wrote: »

Point 1 - I really dont understand. How is someone paying a €600 mortgage worse off in the poverty trap than someone paying €1200 rent, probably being covered by rent allowance?

Point 2 - Ya reckon a job is more stable?

Point 3 - I'd be very happy as a taxpayer to not be paying any rent allowance for people.

Social welfare does not equal dole. There are various schemes that supplement people's income in the short/medium or long term.



Social welfare does not equal dole. There are various schemes that supplement people's income in the short/medium or long term.



You've been rather flippant here so you'll excuse me retorting in kind. In my personal circumstances I had a good job paying the guts of 50K a year, I lost said job in the bust and after a period of unemployment was granted (and I thank the state and taxpayers of which I was and am once again) the BTEA. I then also took on a PT job when one became available and applied for a mortgage with my wife.

So you'll forgive me for blowing a raspberry in your general direction when you've not really thought through what you're on about.

Good points

flintash

kceire wrote:

I was told this by 3 banks in April 2015 also. Ulster Bank, KBC and PTSB. In fact, you are better off hiding the Childrens Allowance from them as they will deduct approx. €400 per month per child from your disposable income.

You mean hide the fact you have a child? I wouldnt know if this considered as non disclosure or fraud.... Either way OP dont try this one..

Mrs OBumble

MarkAnthony wrote: »

You've been rather flippant here so you'll excuse me retorting in kind. In my personal circumstances I had a good job paying the guts of 50K a year, I lost said job in the bust and after a period of unemployment was granted (and I thank the state and taxpayers of which I was and am once again) the BTEA. I then also took on a PT job when one became available and applied for a mortgage with my wife.

So you'll forgive me for blowing a raspberry in your general direction when you've not really thought through what you're on about.

Terse, but not flippant.

Things like the dole, carers allowance, disability allowance etc are not schemes, they're benefits.

Someone who is "on a social welfare scheme" is most likely in a community employment programme or Back to Education allowance. These are transitional things, not permanent arrangements. Tying yourself to a house purchase in a particular location, especially on were you did not have paid employment before going on the scheme, is not a clever move. It restricts your ability to move to a place where paying work is available.

And once the scheme ends, if they don't get a job, then the partner will be back on their pre-scheme benefit. Which will be well less than E188 per week if they're in a domestic relationship with someone earning 27k.

Without income from a second job in the household, I do not see how a mortgage could possibly be sustained.

MarkAnthony

Mrs OBumble wrote: »

Terse, but not flippant.

Things like the dole, carers allowance, disability allowance etc are not schemes, they're benefits.

Someone who is "on a social welfare scheme" is most likely in a community employment programme or Back to Education allowance. These are transitional things, not permanent arrangements. Tying yourself to a house purchase in a particular location, especially on were you did not have paid employment before going on the scheme, is not a clever move. It restricts your ability to move to a place where paying work is available.

And once the scheme ends, if they don't get a job, then the partner will be back on their pre-scheme benefit. Which will be well less than E188 per week if they're in a domestic relationship with someone earning 27k.

Quite a bit of semantics there.

Putting that aside and dealing with your main point I've never said the income should not be treated with some level of circumspection from banks, or that mortgages should be given in large multiples of that income. The current CB rules and banks policies on stress testing are quite sensible.

As for moving, I concede I have a Dublin-centric view and take your point if you're living in the back of beyond. However where you're near a major centre for jobs/family I don't buy this view that whatever the situation the majority of people up sticks and move across the country, especially if they're Dublin based.

Mrs OBumble wrote: »

Without income from a second job in the household, I do not see how a mortgage could possibly be sustained.

No one suggested that anyone, regardless of job/social should be allowed to take on more than they can afford, my issue is with the reaction to the source of that income. Clearly anyone on a low income, be it supported by the state or not is probably going to need a partner's income to purchase.

Gumbo

flintash wrote: »

You mean hide the fact you have a child? I wouldnt know if this considered as non disclosure or fraud.... Either way OP dont try this one..

clearly agree, I was obviously highlighting the fact that showing the SW benefit may actually hinder the application further

L1011

MarkAnthony wrote: »

See above, and also why should someone in full time education not buy a property. I bought my first place at 19 when I was at uni, hence I could afford the deposit when the latest move rocked around.

It has a very, very finite end date and the qualification gained is zero guarantee of employability either.

MarkAnthony

L1011 wrote: »

It has a very, very finite end date and the qualification gained is zero guarantee of employability either.

Good point with a law degree but and IT degree? Come on now.

TheShow

It varies from bank to bank. The best thing to do is go to a mortgage broker, they will deal with all or most of the banks for you. and they are supposed to be obliged to get you the best deal.
27k wont get you much of a mortgage though so your application might be reliant on the other source of income. Check out mortgage calculators on the banks websites for a rough guide of what is affordable on your income levels.

Jen44

kceire wrote: »

clearly agree, I was obviously highlighting the fact that showing the SW benefit may actually hinder the application further

There is no way to hide the childrens allowance. And there is no way it would hinder a mortgage application as unless you are trying to hide the fact you have a child any bank will know once you have a child you are in receipt of childrens allowance

L1011

MarkAnthony wrote: »

Good point with a law degree but and IT degree? Come on now.

I've seen/interviewed plenty of people with IT degrees that I wouldn't hire to be a password change monkey.

A degree does not guarantee employability and I do not consider it safe for a lender to make such an assumption off BTEA even if they do ask what degree is being taken.

Gumbo

Jen44 wrote: »

There is no way to hide the childrens allowance. And there is no way it would hinder a mortgage application as unless you are trying to hide the fact you have a child any bank will know once you have a child you are in receipt of childrens allowance

Childrens Allowance can be hidden by receiving it as a cash payment in your Post Office. Not paper trail, and no effect on your bank accounts.

It hinders the Mortgage application in so much that when they know you have one child, you gain the €130ish allowance, but the bank deduct approx. €400 per month from your disposable income to bring up the child, so the amount of money you can then borrow is hindered

MarkAnthony

L1011 wrote: »

I've seen/interviewed plenty of people with IT degrees that I wouldn't hire to be a password change monkey.

A degree does not guarantee employability and I do not consider it safe for a lender to make such an assumption off BTEA even if they do ask what degree is being taken.

Well you (I assume) and I don't work in underwriting. As above some institutions agree with you and some with me. I suspect they don't make the decision of a single criterion anyway.

TheShow

qualifications mean squat all for a mortgage application. all that matters is demonstrable and sustainable affordability.