Can You Get A Home Loan With Centrelink Benefits?

Some ongoing payments, such as Family Tax Benefit and Age Pension, are accepted by more lenders. Disability Support Pension and carer payments may also be accepted by some lenders. Temporary income-support payments such as JobSeeker are much harder to use.

To qualify, you still need to meet the lender’s normal requirements for borrowing power, deposit, credit history, expenses and property security.

Can Centrelink Payments Count As Income For A Home Loan?

Yes. Some Centrelink payments can count as income when a lender assesses your home loan application.

However, not every payment is accepted, and not every lender treats the same payment in the same way.

A lender may:

• Accept 100% of an eligible payment.
• Use only part of the payment.
• Accept it only when you have employment or another income source.
• Require the payment to continue for a minimum period.
• Exclude the payment completely.

This means the important question is not simply whether you receive Centrelink. It is whether the lender will use your particular payment when calculating how much you can afford to borrow.

Which Centrelink Benefits Are Accepted For A Home Loan?

Lenders do not treat every Centrelink payment the same way. As a general guide, ongoing payments are more likely to be accepted than temporary income-support payments.

Important: A lender accepting a Centrelink benefit does not automatically mean your home loan will be approved. You still need to meet the lender’s borrowing power, deposit, credit and other eligibility requirements.

Why Does The Age Of My Children Matter For Family Tax Benefit?

Family Tax Benefit is linked to your family circumstances, so lenders may consider how long the payment is expected to remain available.

This creates an important distinction between receiving FTB today and being able to rely on the same FTB income throughout the lender’s assessment period.

As your children get older, some lenders may reduce or exclude the amount they are prepared to use.

This is one reason online borrowing-power calculators can give an incomplete picture for borrowers receiving Family Tax Benefit: the calculator may allow you to enter the income without applying the particular lender’s rules around its continuation.

Am I Eligible For A Centrelink Home Loan?

You are more likely to be eligible for a Centrelink home loan if all of these statements are true:

• You receive a Centrelink payment that at least one lender can accept.
• The payment is ongoing or expected to continue.
• You or your co-borrower has enough accepted income to service the proposed mortgage.
• You have sufficient deposit, equity, guarantor support or another eligible deposit pathway.
• Your existing debts and living expenses are manageable.
• You can provide evidence of your Centrelink and other income.
• Your credit history is acceptable.
• The property you want to buy meets lender requirements.

The key word is accepted income.

Your household may receive enough money to comfortably manage the repayments in practice, but the lender can calculate your borrowing power using only the income sources its policy allows.

When Are You Unlikely To Qualify For A Centrelink Home Loan?

You are unlikely to qualify for a Centrelink home loan under the following conditions:

• Your only income is JobSeeker or another temporary benefit that lenders will not use for servicing.
• Your accepted income is not enough to afford the mortgage.
• The Centrelink income you need for servicing is expected to end soon.
• You have insufficient deposit or equity and no other eligible deposit pathway.
• Your existing debts leave insufficient borrowing capacity.
• You cannot provide evidence of the income you receive.

That does not necessarily mean you will never qualify. You may need a change in income, deposit, debts or another part of your financial position before a lender can approve the loan.

Can I Get A Home Loan If Centrelink Is My Only Income?

It may be possible, but your lender options can be significantly more limited if Centrelink is your only income.

The result depends heavily on which benefit you receive.

Long-term payments such as Age Pension or Disability Support Pension may be considered by some lenders differently from temporary payments such as JobSeeker.

The main test is whether:

• The lender will accept the payment as primary income.
• The income is expected to continue.
• The amount accepted is sufficient to service the mortgage.

If your only income is a temporary Centrelink payment that lenders will not use for servicing, you are unlikely to qualify for a home loan.

Can I Get A Mortgage If Part Of My Income Is Centrelink?

Yes. Having Centrelink as only part of your household income can give you more lender options than relying on Centrelink alone.

Common situations include:

• Employment income plus Family Tax Benefit.
• One partner working while the other receives Carer Payment or Carer Allowance.
• Employment income plus Disability Support Pension.
• Age Pension combined with other retirement income.
• Centrelink income combined with a co-borrower’s salary.

A lender can assess the acceptable income sources together when calculating your borrowing power.

Which lenders accept Centrelink income for home loans?

The lenders that accept Centrelink benefits for home loans include major lenders, non-bank lenders, and mostly specialist lenders. There is no lender that simply accepts every type of Centrelink income.

Specialist lenders generally accept more types of Centrelink benefits than major lenders.

That is why Home Loan Experts checks the specific payment, borrower circumstances and current lender policy, rather than simply using a list of so-called “Centrelink lenders”.

What Documents Prove Centrelink Income For A Home Loan?

The documents required vary between lenders and payment types.

You may be asked to provide:

• A current Centrelink income statement.
• A Centrelink letter showing your entitlement and payment amount.
• Bank statements showing Centrelink payments being credited.
• Payslips for employment income.
• Evidence of your partner’s income if applying jointly.
• Additional evidence relating to your particular payment.

For child support or maintenance income, lenders may also request:

• A Child Support Agency assessment.
• Family Court documentation.
• Bank statements showing regular payments.
• Other evidence of the arrangement.

Providing complete documentation before applying can make it easier to determine how much of your income a lender will actually use.

How Can I Improve My Borrowing Power With Centrelink Income?

To improve your borrowing power when getting a home loan while receiving Centrelink benefits, you could:

• Choose a lender that accepts the Centrelink payment you receive. That’s where the expertise of a mortgage broker can help.
• Include all eligible household income, including partner income, rental income, etc that can improve serviceability.
• Reduce unnecessary credit card limits. Lenders generally assess the available limit rather than only the amount currently owing.
• Reduce unsecured debt. Personal loans, car loans and other commitments reduce the income available for mortgage repayments.
• Consider a smaller loan. Increasing your deposit or buying a lower-priced property reduces the mortgage you need to service.
• Avoid applying to multiple unsuitable lenders. A better approach is to establish which lenders accept your income before submitting applications.