Government jobs are often associated with stability and career progression, making you an attractive borrower.
This can translate into better interest rates, the potential to borrow more, and access to mortgages even if you have a smaller deposit.
Your civil servant status can open doors to enhanced lending opportunities and flexible terms. You may be able to borrow more using higher income multiples, secure a mortgage with a longer term, or make larger overpayments.
Let’s see how it works.
Understanding mortgages for civil servants
Do civil servants really have their own mortgage?
Well, there’s no specific mortgage type exclusively for civil servants.
However, enhanced mortgages are available to individuals in certain professions, and civil servants often qualify due to the career progression and stability associated with government work.
You could benefit from enhanced lending terms and many lenders treat each applications on a case by base basis, for a more personal service.
You may be able to borrow more because of your employment status.
Lenders do this by using higher income multiples when calculating the maximum loan size. We cover this in a bit more detail here.
Potential for Better Interest Rates
Some lenders offer competitive interest rates to professionals in specific industries, including civil servants. Jobs with stable income and opportunities for advancement make you an attractive borrower.
Increased Borrowing Potential
While the standard borrowing limit is often 4.5 times your income, some lenders may extend this to 5 or 6 times your salary for civil servants. This increased borrowing power opens up more property options, especially if you’re early in your career or buying on your own.
Higher Loan to Value
If you have a smaller deposit, look for lenders specialising in mortgages for civil servants. Some may offer higher Loan-to-Value (LTV) mortgages (up to 95%), which can help you get on the property ladder sooner.
More Flexibility
Depending on your age now, you may find it easier to take out a mortgage with a longer term length. You may also be given the opportunity to overpay more than the standard 10% per annum limit.
Eligibility criteria
Primarily, you need to be a public sector worker employed at one of the accepted departments below.
This will make you eligible for some of the enhanced mortgage options.
The basic mortgage eligibility criteria remains:
- Minimum age 18
- Good credit score
- At least a 5% deposit
- Low debt to income ratio
- Good affordability
Accepted departments
Civil servants work in various public sector jobs, from administration and management to technical roles, supporting the everyday running of the country.
While the term “Civil Servant” is widely used, lenders differ in their exact definitions of who qualifies.
Here’s a general overview:
Core Civil Servants
Most lenders focus on employees of central government departments and agencies. Examples include:
- Government ministries (Home Office, Ministry of Defence, etc.)
- Executive agencies (DVLA, HM Revenue & Customs, etc.)
- Non-departmental public bodies (Ofsted, the Forestry Commission, etc.)
Other Public Services
Some lenders may broaden eligibility to include:
- Local authority employees (councils, social services)
- Some healthcare workers (NHS employees depending on their specific roles)
- Police officers
- Teachers
Pop in a few contact details and a qualified broker will call you back when convenient.
Types of mortgage
You will have the full range of mortgages available to you. Although the specific choices will differ between lenders.
Residential
Residential mortgages are for the home that you live in. A purchase mortgage will allow you to buy a property and a remortgage switches an existing mortgage to a new lender.
Options are available for first time buyers, guarantor mortgages and JBSP mortgages.
Investment
Investment property mortgages would be for:
Interest rates
The actual rates will always depend on the lender but the main interest rate options are:
Fixed rate: Fixed interest rate mortgages are available in a range of different terms, usually between one and ten years. Once the fixed rate starts your monthly payments won’t be affected by interest rate changes.
Tracker rate: A tracker rate mortgage is a type of variable rate mortgage, which means that the interest rate you pay can go up or down in line with the Bank of England’s (BoE) base rate. Unlike fixed-rate mortgages, a tracker rate can change so the amount you pay each month could go up if interest rates rise.
Variable rate: Variable rate mortgages are linked to the lender’s Standard Variable Rate (SVR). The interest rate you pay will be set by your lender and won’t necessarily rise or fall in line with changes to the Bank of England Base Rate. Your repayments will change when the SVR changes.
Repayment methods
The repayment method is the way that you will pay the mortgage back. There are actually three different options but not all of these will be permitted by your lender.
- Repayment – The traditional capital and interest mortgage where you pay back some of the mortgage each month.
- Interest only – With an interest-only option you only pay the mortgage interest each month and nothing towards the capital sum.
- Part and part – A part and part mortgage is a combination of 1 & 2 above.
Mortgage term
The term is the number of years that your mortgage is setup for.
Traditionally, the standard mortgage term has been 25 years. With rising mortgage and housing costs borrowers are now choosing longer terms, such as 30 and even 40 years. These are sometimes called marathon mortgages.
The term will directly affect the monthly cost of a repayment mortgage, the longer the term, the lower the repayments.
How much can a civil servant borrow?
One of the major advantages of mortgages for civil servants is the potential for higher borrowing amounts.
Instead of the standard income multiples of 4x or 4.5x your annual salary, lenders may extend multiples to 5.5x or even higher. This can significantly increase your purchasing power.
Let’s see how this works:
£50,000 gross salary x 4.5 = £225,000
£50,000 gross salary x 5.0 = £250,000
£50,000 gross salary x 5.5 = £275,000
However, several factors influence how much you can actually borrow:
Income: Your salary is the most crucial factor. Some lenders may consider potential future earnings based on standard civil service career progression.
Deposit: The larger your mortgage deposit, the lower the loan-to-value (LTV) ratio, potentially unlocking better interest rates and increasing the amount you can borrow. A minimum deposit of 5% will always be required.
Credit Score: A strong credit score indicates financial responsibility and can result in lenders being willing to lend you more.
Affordability Assessment: Lenders will carefully assess your income and outgoings (including other debts) to determine how much you can comfortably afford to repay each month. Your job security as a civil servant can be a positive factor in this assessment.
How much do mortgages cost?
The cost of a mortgage is affected by the loan size, the interest rate and the loan term.
You can use our mortgage calculator to accurately calculate the monthly repayments.
These pages may also be of interest:
Average Mortgage Payments: Understand what homeowners across the country are paying and how property location can affect your mortgage outlay.
Mortgage Repayments Guide: Learn more about the monthly cost of different mortgages, including repayment and interest only.
How much do you need to earn: We explain mortgage affordability and give a guide on how much you need to earn.
How to apply
By working with an independent mortgage broker you will get access to the widest possible choice of lenders and mortgage deals.
Experienced advisers will be able to quickly pinpoint the best deals that suit your civil service status.
They can then check whether you qualify for any special deals.
Your broker can arrange an agreement in principle, or AIP, which will provide a good idea about whether a specific lender will approve the mortgage you need.
They will then be able to help you complete the application forms and collate (and check) all of the necessary documents and paperwork.
Improve your chances of success
Getting yourself organised and ‘mortgage ready‘ before applying for a mortgage is one of the best things you can do.
Whether you are buying your first home or thinking of moving somewhere new, there are a number of ways that you can improve your situation, which will also speed up the mortgage process.
It’s really important to allow yourself enough time to gather everything together.
Credit status
Get a copy of your credit report. The report will show all sorts of credit related information and you need to make sure that it is all correct. Any errors need to be fixed.
Mortgage broker
Speak with a mortgage broker, they will be able to see how well you ‘fit’ a lenders criteria and can make practical suggestions and tips on how you can improve your situation.
Decision in principle (DIP)
Ask your mortgage adviser whether a Decision in Principle, or DIP, would be a good idea. Most first time buyers will benefit from one. A DIP or AIP will provide some extra confidence in your ability to borrow the size of mortgage you need.
Electoral roll
One factor that can greatly impact your mortgage application and creditworthiness is your presence on the Electoral Roll. The Electoral Register, is a comprehensive record of eligible voters in the United Kingdom. Am I on the Electoral Register?
Financial Associations
If you have previously applied for any type of credit with another person, the Credit Reference Agencies (CRA) will have ‘linked’ you to the other party. If an old or irrelevant financial association is still on your report, it is important to remove it.
Paperwork
Get your paperwork in order. The main documents needed are: Driving licence, Passport, Utility bills,
Last three/six payslips, Most recent P60, Company accounts, Self-assessment returns, SA302, CIS vouchers, Bank statements, Proof of deposit
Pay your bills
on time. (always)
Don’t apply
for any more credit before or during the mortgage application process. This could seriously damage your chances of being approved.
Credit limits
Stay well within your credit limits and if possible, reduce any debts held on credit cards or store cards.
Mortgage broker
Contact an experienced mortgage broker. Oh, we said that already. Don’t forget!!
How a broker can help
Your occupation as a civil servant may grant you access to exclusive or enhanced deals that general mortgage products don’t offer.
The best way to find and compare these specialist deals is by using a qualified whole of market mortgage broker. An experienced broker will do the research on your behalf, finding your ideal mortgage from over 100 lenders.
They will understand your industry, your pay structure and the lender’s that favour careers like yours.
Searching for your own mortgage is very time-consuming and can also be quite confusing. While some people are happy to do this themselves, others recognise the advantages of using a qualified broker.
- What is a whole of market mortgage broker?
- What does a mortgage broker do?
- Do mortgage brokers charge a fee?
- Why should you use a mortgage broker?
- Why would you use a mortgage broker instead of a bank?
- How do mortgage brokers get paid?
- Mortgage broker vs Bank: Which is better for you?
- What are the advantages of using a mortgage broker?
- Ten Reasons to Use a Mortgage Broker
Civil servants are viewed as low risk borrowers by lenders, who are comfortable offering enhanced lending terms.
While there is no specific ‘civil servant’ mortgage, a mortgage adviser will be able to source those lenders that prefer civil servants as customers, and most will offer enhanced deals or lending criteria.
Firstly, a broker can give you access to the widest possible choice of lenders and mortgage deals.
They can find those deals that are aimed at civil servants, to see if this gives you an advantage. Sometimes a better deal can be found from a non-exclusive lender.
In addition, brokers are excellent problem solvers.
They can help with situations where you need a low deposit mortgage, or if you need a joint mortgage with your parents, or where there is a problem with the property itself.
Yes, mortgages are available for first-time buyers.
We work with one of the largest and most experienced independent mortgage brokers in the UK.
They have been experts in the mortgage industry for over 45 years, so they understand the challenges that clients can face when looking for a mortgage.
With qualified advisers based across the UK, they have the experience and expertise to help guide you through the complex process of buying a house, remortgaging, raising bridging finance or investing in the property market.
Fully FCA regulated, they have more expertise across more lending solutions than any other broker and have specialist teams in place to work with clients through every stage of their journey.
To get started please call us on 0330 030 5050 so we can match you to a specialist broker, or use the form below.
