You can get a mortgage with only Social Security income, as long as your finances are strong overall (2024)

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• If the only income you receive comes from Social Security, you may still be able to qualify for a mortgage.
• In some cases, a lender might be able to "gross up" your income if the benefits you receive aren't taxable.
• In addition to a sufficient income, you'll need a low debt-to-income ratio, good credit score, and large enough down payment to qualify for a mortgage.
• Shop today's 30-year mortgage rates.

Before approving an applicant for a mortgage, lenders will look at their income to ensure they have the ability to repay the money they're borrowing.As long as your income comes from an acceptable source, it shouldn't prevent you from getting approved for a mortgage.

If you receive Social Security income, you can use it to qualify for a mortgage. But whether you'll ultimately be approved will depend on your overall financial situation.

Can you get a mortgage in retirement?

Yes, you can get a mortgage in retirement, even if your only income comes from Social Security retirement benefits or other types of Social Security.

Retired individuals and others who live on a fixed income can sometimes have a more difficult time qualifying for a mortgage if their income is too low relative to the amount of debt they'd be taking on. But if you have a sufficient income that comes from an acceptable source, lenders can't turn you down simply because of your age or the fact that you receive Social Security.

How to use Social Security income to get a mortgage

You'll need to submit documents when you apply for a mortgage that show you have a steady source of income. For Social Security benefit recipients, this means you'll need to show your lender that you're currently receiving benefits and the amount you receive each month.

To get this information to share with your lender, you can request a Social Security Benefit Verification letter from the Social Security Administration's website.

Once you've verified your income and completed the rest of your application, the lender will look at your overall financial profile to determine whether you qualify for a mortgage, and if so, how large of a monthly mortgage payment you can afford.

Those with lower incomes can have a harder time obtaining mortgage approval because a mortgage can push your debt-to-income ratio (DTI) too high. Your DTI is the total of all your monthly debt payments relative to your monthly income. If your total income is $2,000 a month, for example, a $1,000 monthly mortgage payment would put you at a 50% DTI, assuming you don't have any other debts.

A DTI of 50% is typically the maximum a lender allows — but depending on your lender and the type of mortgage you're getting, it may be lower.

How lenders view Social Security income

Mortgage lenders can't deny credit to applicants simply because their income comes from Social Security. Social Security income is viewed the same as any other type of income, with one exception that can work in recipients' favor.

Mortgage lenders typically look at an applicant's gross income when qualifying them for a mortgage. Your gross income is what you earn before taxes are deducted from your paycheck, so the lender's calculations are set up to account for that. But many individuals who receive Social Security benefits don't have to pay taxes on that income.

For example, if you receive Social Security Disability Income (SSDI) that you aren't required to pay taxes on, your lender may be able to "gross up" your income by 25%, according to Shashank Shekhar, founder and CEO of InstaMortgage.

"So if you're getting $1,000 a month, that income could actually go up to $1,250 when it comes to the underwriter qualifying the income, because a lot of these incomes are tax-free," Shekhar says.

Whether your income will be adjusted depends on the type of benefits you receive and whether they're taxable or not. Standard Social Security retirement benefits and SSDI may be taxable up to a certain amount if your total income is more than $25,000 (or $32,000 for spouses filing jointly). Supplemental Security Income (SSI) isn't taxable.

What else you need to qualify for a mortgage

Remember, lenders will look at your entire financial situation, not just where your income is coming from. To improve your chances of getting approved for a mortgage, you should have:

• A good credit score. Conventional mortgages require a credit score of at least 620, while FHA mortgages require scores of 580. The higher your score, the more likely you are to be approved. Those with higher scores also typically get better interest rates.
• A sufficient down payment. Conventional mortgages allow down payments as low as 3%, while FHA mortgages require 3.5%. Putting down more than this can increase your approval odds, help boost your buying power, and earn you a lower rate.

Additionally, if you have other sources of income aside from your Social Security income, be sure to include that in your application. This could include things like retirement accounts or earnings from investments.

Can you get a mortgage with only social security income FAQs