Does our son’s disability payment count as income for mortgage purposes?

FitzWilliams

We’re looking to sell up and move to a bigger house so our 10 year old son can get his own downstairs room away from his sibling . He is severely disabled so receives higher disability living allowance to help with his care. Though the dla is for him, it’s paid to my wife into our family account. The dla is always addressed to my wife with ‘on behalf of my son’s name’ on the letter. Will his payment be taken into account as extra income when applying for a mortgage?

housebuyer143

FitzWilliams said:

We’re looking to sell up and move to a bigger house so our 10 year old son can get his own downstairs room away from his sibling . He is severely disabled so receives higher disability living allowance to help with his care. Though the dla is for him, it’s paid to my wife into our family account. The dla is always addressed to my wife with ‘on behalf of my son’s name’ on the letter. Will his payment be taken into account as extra income when applying for a mortgage?

If you use Skipton building society it does. 
I had a similar issue as needed the DLA to be used toward affordability to get us over the line. Many lenders don't accept it as it's not in the borrowers name.

There might be others but Skipton lend a fair chuck based on your salary and also take your childs DLA into account.

fergie_

It depends on the lender. Natwest accepted it, but at a lower multiplier.

housebuyer143

fergie_ said:

It depends on the lender. Natwest accepted it, but at a lower multiplier.

They don't. They say they accept DLA but they only accept it if it's guaranteed for life and in the applicants name. They were the other lender I tried and they said 100% no. 

diystarter7

housebuyer143 said:

fergie_ said:

It depends on the lender. Natwest accepted it, but at a lower multiplier.

They don't. They say they accept DLA but they only accept it if it's guaranteed for life and in the applicants name. They were the other lender I tried and they said 100% no. 

Hi
As I read through the posts, I was going to say exactly that, ie for life. Even then they would look at the prognosis etc for the duration of the borrowing, ie type of illness reuslting in disability.

JMA74

housebuyer143 said:

FitzWilliams said:

We’re looking to sell up and move to a bigger house so our 10 year old son can get his own downstairs room away from his sibling . He is severely disabled so receives higher disability living allowance to help with his care. Though the dla is for him, it’s paid to my wife into our family account. The dla is always addressed to my wife with ‘on behalf of my son’s name’ on the letter. Will his payment be taken into account as extra income when applying for a mortgage?

If you use Skipton building society it does. 
I had a similar issue as needed the DLA to be used toward affordability to get us over the line. Many lenders don't accept it as it's not in the borrowers name.

There might be others but Skipton lend a fair chuck based on your salary and also take your childs DLA into account.

Skipton's current policy:

• DLA has to be in the applicant's name only. It cannot be taken into account for affordability if the customer is in receipt of DLA for a disabled child. 

housebuyer143

JMA74 said:

housebuyer143 said:

FitzWilliams said:

We’re looking to sell up and move to a bigger house so our 10 year old son can get his own downstairs room away from his sibling . He is severely disabled so receives higher disability living allowance to help with his care. Though the dla is for him, it’s paid to my wife into our family account. The dla is always addressed to my wife with ‘on behalf of my son’s name’ on the letter. Will his payment be taken into account as extra income when applying for a mortgage?

If you use Skipton building society it does. 
I had a similar issue as needed the DLA to be used toward affordability to get us over the line. Many lenders don't accept it as it's not in the borrowers name.

There might be others but Skipton lend a fair chuck based on your salary and also take your childs DLA into account.

Skipton's current policy:

• DLA has to be in the applicant's name only. It cannot be taken into account for affordability if the customer is in receipt of DLA for a disabled child. 

Damn! I got lucky then. It was only 6 months ago I applied with them. Really not sure why more lenders don't take it - kids payments obviously go to the parents and form their income. 

theoretica

Nationwide website says 'DLA paid to an applicant for a child under 16 is also acceptable' so might be worth looking into https://www.nationwide-intermediary.co.uk/lending-criteria/income

JMA74

theoretica said:

Nationwide website says 'DLA paid to an applicant for a child under 16 is also acceptable' so might be worth looking into https://www.nationwide-intermediary.co.uk/lending-criteria/income

you are correct on this. Nationwide are always pretty good with benefits as long as there is other earned income on the case as well. 

Yes - key to the state disability benefit field and provide the latest award notice. DLA paid to an applicant for a child under 16* is also acceptable. In Scotland, from November 2021, DLA for a child is gradually being replaced by a Child Disability Payment. Provided the child is under 16, this is acceptable.

Although just as an additional point, I have had plenty cases were I could borrow more from lenders that dont use the benefits than ones that do.   So make sure all options are taken into account

fergie_

It's likely also to be worth speaking to a mortgage adviser about it and what is best for your circumstances.