Getting a Mortgage if You’re Paid in Cash

Getting a mortgage if you're paid in cash can be tricky, a mortgage expert can help you with this.

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Home Income Types Getting A Mortgage If You’re Paid In Cash
Pete Mugleston

Author: Pete Mugleston

Mortgage Advisor, MD

Updated: March 15, 2024

In this article, we’ll explain how it’s still possible to get a mortgage if you’re paid in cash, what evidence you’ll need to produce to prove your earnings and how a mortgage broker can help you through the application process.

Can you get a mortgage if you get paid in cash?

Yes. Although there are mortgage lenders, such as Post Office Money and Metro Bank, who decline customers with cash income outright, other mortgage providers are more flexible and can consider applicants with cash-in-hand wages, under the right circumstances.

Despite the myths that tend to circulate around this topic, it’s not illegal or dodgy to be paid cash-in-hand for work carried out in the UK. It’s perfectly acceptable as long as the employer is paying the employee’s PAYE (Pay As You Earn) and National Insurance contributions to HMRC and the employee agrees to cash wages.

If cash is the main source of your income, you can expect the lender to carry out extra checks and place more scrutiny around your affordability to safeguard themselves. Additional payslips, P60s, bank statements, or employer references may be requested as most mortgage providers will want to see your salary paid into your bank account.

Applicants whose main income is cash payments have a higher chance of mortgage rejection if they head to the market without professional guidance. This is simply because there’d be fewer approachable lenders compared to someone who’s paid directly into their bank account – but there’s a quick and easy way to tip the odds in your favour.

There are mortgage brokers who specialise in customers who are paid cash-in-hand. They fully understand the needs of these applicants and have deep working relationships with the lenders who offer mortgages based solely on cash income. Speaking to the right broker before you apply is the best way to make sure you get the ideal mortgage for you.

When is cash income not acceptable?

Some mortgage lenders have strict caveats when it comes to applicants who make their money cash-in-hand.

Certain mortgage providers might decline an application if…

  • They have any reason to suspect the employer isn’t paying the right tax
  • The applicant has recently moved to the UK from another continent
  • Not enough proof of income – additional evidence may be required for cash-in-hand applicants, such as extra payslips, P60s, bank statements, or employers references
  • The cash-earner is the main applicant – a minority of lenders only consider applications on a joint basis where the second applicant is the cash-earner
  • The cash-based job isn’t a full-time position

As you can see from the example criteria above, there are lender restrictions that you can fall afoul of if you’re a cash-earner and you approach mortgage lenders at random. The best way to avoid these pitfalls and boost your chances of mortgage approval is to find a broker who specialises in cash-based applications and arranges them every day.

How to get a mortgage with cash-in-hand income

The application process itself will be no different to applicants who don’t receive cash-in-hand wages, besides the possibility of extra scrutiny from the lender…

Here are the steps to follow to kick off your mortgage application…

  • Get your documents together: As a cash-income applicant, you might need extra proof of your earnings. So make sure you have at least three months’ worth of payslips and bank statements, as well as your P60. You might also need a reference from your employer confirming that you’re paid cash-in-hand.
  • Download your credit reports: It’s a good idea to download all of your credit reports to make sure they’re fully up to date. Challenge any inaccuracies and have any outdated information removed.
  • Find a mortgage broker: This is highly recommended if your income is made up of cash payments. The right mortgage broker can make sure you’re paired with the ideal lender, first time, boosting your chances of mortgage approval.

Make an enquiry with us so we can match you with a mortgage broker who specialises in cash-in-hand applications and help you ensure your application gets off on the right track.

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How to evidence a cash-based deposit

Cash deposits which were sourced from cash-in-hand income are perfectly acceptable as far as most lenders are concerned. They need to be evidenced in the usual way, via bank statements showing the funds building up in your account and during the affordability assessment, in which the lender will request wage slips from you.

Moreover, cash deposits from other sources, such as gifted deposits from family, will need to be evidenced with documentation. In this case, you’ll need a letter from the person who is providing the gift to confirm it in writing and state that they will have no interest in the property.

Cash-funded mortgage deposits are only an issue for lenders and underwriters if the origin of the funds cannot be traced or the source is illegitimate. If either of these things is true of your cash deposit, these funds generally can’t be used for a mortgage application.

Speak to a broker who specialises in cash-income mortgages

If your income comes from cash-in-hand payments, speaking to a broker before you apply for a mortgage is recommended. The right broker can offer bespoke advice, guide you through the application process and make sure you find the right lender, first time.

We’ve made it our mission to make sure people find the perfect mortgage broker for them. Our free broker-matching service will carry out a quick assessment of your needs and circumstances to pair you up with the advisor who’s best placed to help you get the best mortgage deal available to you. In this case, it will be a mortgage expert we’ve handpicked because of their knowledge and experience with cash-in-hand-earning applicants.

Call us today on 0808 189 2301 or make an enquiry and we’ll set up a free, no-obligation chat between you and a broker who specialises in mortgages for people on cash income every day.

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About the author

Pete, an expert in all things mortgages, cut his teeth right in the middle of the credit crunch. With plenty of people needing help and few mortgage providers lending, Pete found great success in going the extra mile to find mortgages for people whom many others considered lost causes. The experience he gained, coupled with his love of helping people reach their goals, led him to establish Online Mortgage Advisor, with one clear vision – to help as many customers as possible get the right advice, regardless of need or background.

Pete’s presence in the industry as the ‘go-to’ for specialist finance continues to grow, and he is regularly cited in and writes for both local and national press, as well as trade publications, with a regular column in Mortgage Introducer and being the exclusive mortgage expert for LOVEMoney. Pete also writes for Online Mortgage Advisor of course!

Read more about Pete

Pete Mugleston

Mortgage Advisor, MD

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