This question has come up in a few forums lately, so we’re taking time out to answer it for you.
The short answer is yes; you can get a home loan if you are receiving Centrelink payments. But if Centrelink is your only source of income, it’s unlikely that a lender will approve you for a home loan.
If someone in your household is in paid employment, this will increase your likelihood of securing a loan. In this case, when assessing your income, the lender will also consider what you are receiving from Centrelink.
Yes, if you already have a home loan, it is legal to use Centrelink or Austudy funds to pay it off.
If you are a student and only have a limited disposable income, it is probably not the best time to take on a home loan. Of course, every individual’s situation is different. Perhaps your partner works full-time, while you study. In which case, you have a regular income to rely on and the prospect of future income when you enter the workforce.
A lender will always assess your eligibility based on risk. Are you likely to make repayments reliably? Do you have the income to support payments over the term of your mortgage?
A good mortgage broker will tell you whether you’re in a position to take on a home loan. If you’re not quite there yet, they should also be able to explain what steps need to be taken to get you ‘home-loan ready’.
This is why we encourage people to speak with a mortgage broker well before they even consider buying a property. It means you have more realistic expectations around repayments, as well as the additional fees involved with the purchase process.
Most people would agree that stretching beyond your budget is stressful. By simply planning ahead, you can set yourself up for a smoother journey towards home ownership.
No matter where you’re at, we can help you achieve your home loan goals. Talk to a Capita broker today.
Legal Advice Disclaimer: This information is general in nature. Mortgage brokers do not provide legal advice. Clients who require legal advice should seek the services of a qualified legal professional.