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It is possible that you can be eligible for a secured loan if you are receiving benefits, as some lenders are willing to let you declare some of them as income.
The tricky part can be knowing which ones will be accepted and the types of deals that will be open to you based on your circumstances.
Here’s what you need to know about using benefits as income when applying for a secured loan.
If you are receiving benefits – such as disability benefits or unemployment benefits – and this is your only form of income, there are specialist lenders that will allow you to apply.
The key to a successful secured loan application often comes down to your affordability, so these lenders will want to ensure that it will not be too much of a financial burden for you to take on.
Before you apply, it may be a good idea to get in touch with the Willows team who can answer your questions about eligibility and give you more guidance about secured loan affordability.
Carer’s Allowance is accepted by most lenders as a form of income, so you can use this for your affordability assessment.
As is the case with all forms of income, the lender will want to see some kind of relevant documentation so it can be cross-referenced and confirmed.
If you’re not sure what type of information you need to provide, our team of friendly advisors are available to answer any questions you may have about using carer’s allowance and any other form of benefit as income.
If you are currently receiving Personal Independence Payment Benefit (PIP), this can be reviewed as part of your affordability assessment along with any other relevant income.
The lender will explain what kind of documents they need to see to confirm your current PIP status, which you can then submit for review.
Adding Disability Living Allowance for your affordability assessment shouldn’t cause any issues for most lenders.
If you include it as part of your overall income, they usually want to check the period it has been awarded for, so will ask you to submit any relevant documents.
Universal Credit has replaced Housing Benefit for most new claimants, so while you cannot reference Housing Benefit as a specific form of income, there are some instances where Universal Credit can be accepted.
If you need more insight, we’d be happy to talk through your options based on the benefits and income you receive to give you a better idea of your eligibility.
Lenders generally try to be as flexible as possible when it comes to accepting different forms of income, which includes assessing Job Seeker’s Allowance and Employment and Support Allowance benefits.
Some lenders are happy to accept these types of benefits on their own, while there may be additional criteria applied by others.
This is usually determined by the number of applicants involved and their employment status – we can give you more clarity about how this applies to you when you get in touch.
Income Support is accepted by most lenders, although most people who have migrated away from this benefit are using Universal Credit instead.
This is because the Department for Work & Pensions has asked existing income support claimants to switch to Universal Credit and are no longer accepting new claims for this benefit.
So, whether you are receiving Income Support or Universal Credit, you can include it as part of your monthly income.
To get a better understanding of your eligibility, you may find it helpful to speak with us about your situation, as this can make it easier to find a suitable lender.
Getting a quote won’t affect your credit score
You can include Industrial Injuries Disability Benefit in the income section of your secured loan application as lenders will accept it.
The lender will likely ask you to provide proof of your claim that is dated within a certain timeframe, along with one or two other additional documents, but this will all be explained at the start of the process.
You can include income received from Working Tax Credits so it can be reviewed in your affordability assessment.
However, this only applies to existing claimants of the benefit, as it is being replaced by Universal Credit in 2025, so new claims are no longer being accepted.
Please see above for more information about using Universal Credit as income.
Widowed Parent’s Allowance is accepted as a form of income by secured loan providers. However, since it became Bereavement Support Payment, most people do not have access to this type of benefit.
If you are still receiving Widowed Parent’s Allowance and want to include it, lenders will ask you to provide an award statement and other related documentation so they can ensure you are eligible for the loan.
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We’re extremely proud to be rated ‘Excellent’ for our service standards. We’ve helped thousands of customers across the UK over the last 15 years to find the right finance for their needs – no matter how complicated the circumstances. And we look forward to helping you.
If you claim a benefit and are not sure if you can use it as income for a secured loan, we can offer expert advice, so you know exactly where you stand.
Our friendly team of brokers are on hand to answer any questions you have about benefit income and secured loans. You can get in touch with them today by calling 01656 766 158 and they’ll be more than happy to help.
If you have a question – we’d be happy to talk to you – simply call us…
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At Willows Finance we ensure your personal information is kept secure and confidential.
PRIVACY OF YOUR INFORMATION
At Willows Finance Ltd, we appreciate that your privacy is extremely important to you. With this in mind, we have put in place a number of measures to ensure that any personal details we obtain from you as a result of visiting this website is processed and maintained in accordance with accepted principles of good information handling and also in accordance with the Data Protection Act 1988.
This statement provides you with details of the type of information we may hold about you, how we obtain and use information and how we protect your privacy.
Willows Finance Limited
Brocastle, Bridgend, CF35 5AS
Authorised and regulated by the Financial Conduct Authority
Firm Reference Number: 670052
Company Number: 06678545 (Registered in England and Wales)
This document explains the services we provide, the range of lenders and products we consider, how mortgage advice may be provided, and how Willows Finance may be paid. Please read it carefully before proceeding with an application.
If you need clarification about any part of this document, please contact us on 01656 766158.
Willows Finance arranges first and second charge mortgage products. Depending on the circumstances of the application, these may include:
We also arrange both regulated and unregulated bridging finance.
Not every product will be suitable or available to every customer. The products considered will depend on your circumstances, borrowing requirements, purpose of the borrowing, property, intended use of the property and the relevant lender criteria.
Depending on your circumstances, Willows Finance may:
If you are looking to increase borrowing secured on a property which already has a regulated mortgage, there may be different ways of raising the additional funds. Depending on your circumstances, these may include:
Where applicable, we will make you aware of these alternatives before proceeding. The options we are able to assess or advise on will depend on the service being provided and the lenders available to us.
The regulatory status of a mortgage or bridging loan depends on the circumstances of the transaction, including the property, how it is or will be occupied, the purpose of the borrowing and the customer’s circumstances.
Our business includes:
We will identify the regulatory status applicable to your application and explain the service and protections that apply. The protections available to you can differ depending on the type of mortgage or loan.
The range of lenders and products we consider depends on the type of finance you require.
We offer a comprehensive range of second charge mortgages from across the relevant market using a representative panel of lenders. We review our panel regularly to ensure that it remains sufficiently broad and representative. We do not consider products that are only available by applying directly to a lender.
We only offer first charge mortgages from a limited panel of 13 lenders. We consider the first charge mortgage products made available to us by Kensington Mortgages, The Mortgage Works, Aldermore, United Trust Bank (UTB), Together, Masthaven, West One, Norton, Bluestone, Vida, Pepper Money, Mansfield Building Society and Nationwide Building Society.
We do not offer every first charge mortgage available from across the market.
We consider products from a range of lenders available to Willows Finance for the relevant transaction.
Consumer Buy-to-Let and unregulated Buy-to-Let applications are considered within the relevant first charge, second charge or bridging route, depending on the structure of the transaction.
We do not provide a whole-of-market service and do not claim to consider every mortgage or secured finance product available in the UK. Our assessment is based on the lenders and products available through our lender and distribution arrangements.
Where the applicable regulatory rules require us to identify the lenders whose products we offer, the relevant lender list will be provided to you in a durable medium as part of the initial disclosure for your application. A lender list is also available on request where applicable.
The service provided will depend on the lender, product and application route identified for your circumstances.
Where Willows Finance provides the mortgage advice, we provide an advised mortgage broking service. We will obtain information about your needs and circumstances, assess the lending options available within the scope of our service and, where appropriate, make a mortgage recommendation.
We will make it clear where Willows Finance provides the mortgage advice and recommendation.
We may also provide a packaging service. This is a non-advised administrative service under which we may collect information and supporting documents, complete administrative checks, liaise with the relevant parties and submit or progress an application.
When we provide a packaging service, we do not assess the suitability of the mortgage, provide mortgage advice or make a personal recommendation. Any regulated mortgage advice or recommendation will be provided by the appropriately authorised intermediary responsible for advising you.
Our packaging service is not a regulated advisory service. However, the mortgage itself and any arranging activity connected with it may still be regulated and subject to the applicable regulatory requirements. We will explain the nature and regulatory status of the service we are providing before you proceed.
For some applications, particularly certain second charge mortgage applications, our sourcing exercise may identify a route where the subsequent mortgage advice is provided by another regulated mortgage intermediary.
In these cases, the Willows Finance service may include:
After the introduction, the receiving intermediary may take over the detailed application, advice and recommendation process. We will make it clear where this type of referral arrangement applies.
Where our sourcing process identifies Evolution Money Limited as an appropriate route and we introduce your application to Evolution Money, Willows Finance will not provide the regulated mortgage advice or make the final mortgage recommendation in relation to the Evolution mortgage.
Following the introduction, Evolution Money Limited will take over the detailed application and advisory process. Evolution Money will assess your needs and circumstances and will be responsible for any regulated mortgage advice and recommendation it provides in relation to the Evolution mortgage.
Willows Finance remains responsible for the service it provides before and in connection with the referral, including its initial assessment, sourcing and introduction activity.
If you are experiencing financial difficulty, or if you are considering borrowing to consolidate existing debts, free and impartial debt advice is available from MoneyHelper and other free debt-advice organisation.
MoneyHelper: www.moneyhelper.org.uk
You should consider obtaining free debt advice if you are unsure whether further borrowing or debt consolidation is right for you.
We process your personal information in accordance with our Privacy Policy. Where we introduce you to a lender or another intermediary, that organisation will process your information in accordance with its own privacy information.
Willows Finance Privacy Policy: willowsfinance.co.uk/privacy-cookie-policy/
The way Willows Finance is paid depends on the lender, product and application route. We may receive a fee paid by you, commission paid by a lender or another third party, or a combination of these. We will explain the basis on which we will be remunerated in connection with your application.
Where Willows Finance off an advised service our fees are split into two parts. A fee for the advice you receive and a fee for the processing of the application to completion. Both of these fees can be added to the loan rather than paid upfront or you have the option of paying them in advance. We do not arrange loans below £10,000.
For the advice the fee is as follows;
For a first charge mortgage, our advice fee is 5% of the amount borrowed, subject to a minimum fee of £625 and a maximum fee of £1,250.
For a second charge mortgage, our advice fee is 5% of the amount borrowed, subject to a minimum fee of £625 and a maximum fee of £1,750.
For a first charge mortgage, our processing fee is 5% of the amount borrowed, subject to a minimum fee of £625 and a maximum fee of £1,250.
For a second charge mortgage, our processing fee is 5% of the amount borrowed, subject to a minimum fee of £625 and a maximum fee of £1,750.
| Service | First charge | Second charge |
|---|---|---|
| Advice fee | 5%, min £625, max £1,250 | 5%, min £625, max £1,750 |
| Processing fee | 5%, min £625, max £1,250 | 5%, min £625, max £1,750 |
On borrowing of £10,000 5% would be £500, but the minimum fee for advice and processing means that we would charge £625 for each to £1250 in total.
On borrowing £20,000 the total fees would be £2,000
On borrowing £50,000 the maximum fee means that we would charge a total of £2500 for a 1st charge mortgage and £3500 for a 2nd charge mortgage.
If your mortgage or loan completes following an introduction made by Willows Finance, we will receive commission from the lender or another third party in the distribution chain unless we tell you otherwise. Different lenders may pay different amounts and may use different commission models.
Commission models may include:
The availability or amount of commission does not determine which lender we consider appropriate for your circumstances. Where applicable, we will tell you that commission will be received.
For an MCD regulated mortgage (a mortgage within the Mortgage Credit Directive rules), where the exact amount of commission is not known at the time of the initial disclosure, we will tell you that the actual amount will be disclosed later in the ESIS. Where applicable and on request, we will also provide information about how commission levels vary between lenders offering the mortgage being considered.
Where we introduce you to Evolution Money, the commercial arrangement is different from a broker fee charged directly by Willows Finance.
Under the current Evolution arrangement, Evolution Lending charges a Product Fee equal to 10% of the net loan advance, subject to a maximum of £5,000. If the mortgage completes, Evolution pays the corresponding amount to Willows Finance as commission/remuneration for the sourcing, distribution and introduction service.
The amount of the product fee and the amount of remuneration payable to Willows Finance will be disclosed to you in the relevant mortgage documentation before completion.
Example: on a £10,000 net advance, a 10% Product Fee would be £1,000. The actual Product Fee and the amount of commission payable to Willows Finance will be set out in the relevant Evolution mortgage documentation before completion.
If you choose to add a Product Fee or other fee to your mortgage, interest will be charged on that amount while it remains outstanding, increasing the total amount you repay.
Where a Willows Finance fee is payable only on completion, it will not become payable if the mortgage does not complete. Any fee payable before completion, third-party costs and the circumstances in which a fee is refundable or non-refundable will be explained where applicable.
Fees which have become payable following completion are generally non-refundable unless the relevant contractual terms, applicable law or regulatory redress require otherwise.
Before you become bound by a regulated mortgage, you will receive the relevant mortgage illustration or European Standardised Information Sheet (ESIS) and the lender’s offer documentation as applicable.
These documents contain important information about the proposed mortgage, which may include:
Please read these documents carefully. If anything is unclear or does not reflect your understanding, contact the firm responsible for the advice or recommendation before proceeding.
You may tell us that you no longer wish to proceed with an application before completion. Whether any third-party cost is payable or refundable will depend on its own terms.
For an MCD regulated mortgage (a mortgage within the Mortgage Credit Directive rules), the lender will provide a binding offer with a reflection period of at least seven days. You may normally accept the offer during that reflection period if you decide to proceed.
Once a mortgage has completed, there is generally no right simply to cancel or withdraw from the mortgage. You may have a right to repay the mortgage early in accordance with its terms, and an early repayment charge may apply.
Always check the early repayment section of the ESIS and mortgage offer before completion if early repayment or regular overpayments are important to you.
If you miss or make late payments, the lender may apply charges, and your credit record may be affected. Continued failure to maintain payments may result in enforcement action and ultimately repossession of the property used as security.
If you are experiencing financial difficulty, contact your lender as soon as possible and consider obtaining free independent debt advice.
Consolidating existing debts into a mortgage can reduce monthly payments but may increase the total amount of interest you pay if the borrowing is repaid over a longer period.
Debts which are currently unsecured may become secured against your home. Extending the repayment period may mean that you pay considerably more overall even where the monthly payment is lower.
Interest rates on variable-rate mortgages can increase, which may increase monthly repayments and the total amount repaid.
YOUR HOME MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON A MORTGAGE OR OTHER LOAN SECURED ON IT.
If you are dissatisfied with any aspect of the service provided by Willows Finance, please contact us:
Willows Finance Limited
Brocastle, Bridgend, CF35 5AS
Telephone: 01656 766158
Email: [email protected]
We will investigate your complaint in accordance with our complaints procedure. If you remain dissatisfied with our final response, or in other circumstances where you are eligible to do so, you may be able to refer your complaint to the Financial Ombudsman Service.
Financial Ombudsman Service: www.financial-ombudsman.org.uk
Where another regulated intermediary has provided the mortgage advice or recommendation, complaints about that firm’s advice should normally also be raised with that firm. You can still complain to Willows Finance about the service provided by Willows Finance.
The Financial Ombudsman Service can generally consider complaints about regulated or otherwise covered activities, including certain activities that are ancillary to them. It may not be able to consider a complaint that relates solely to an unregulated product or service and has no connection with a regulated or otherwise covered activity. Whether a complaint falls within its jurisdiction will be determined by the Financial Ombudsman Service based on the individual circumstances.
Willows Finance Limited is covered by the Financial Services Compensation Scheme for eligible regulated activities. If an authorised firm is unable to meet an eligible claim, compensation may be available from the FSCS.
For protected home finance mediation, the current compensation limit is 100% of an eligible claim up to £85,000 per eligible claimant, per firm. Eligibility depends on the circumstances of the claim and the applicable FSCS rules.
FSCS protection does not generally apply to a claim arising solely from an unregulated product or service, including any packaging service that falls outside regulated home-finance mediation. Whether a claim is eligible will depend on its individual circumstances and the applicable FSCS rules.
Further information: www.fscs.org.uk
Once we have received sufficient information about your circumstances and requirements, we will carry out the relevant initial assessment and sourcing process and explain which application route applies to you.
Where Willows Finance provides the mortgage advice, we will continue through our advised mortgage process and explain any recommendations made.
Where your application is referred to another regulated intermediary, such as Evolution Money, we will explain that the receiving intermediary will take over the subsequent application and advisory process where applicable.
Please review all mortgage illustrations, ESIS documents, fee and commission disclosures, offer documents and other terms carefully before deciding whether to proceed. If anything is unclear, ask before committing to the mortgage.
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