Applying for a loan while pregnant

Having a baby is a big life change. While it can be an exciting time, you may find yourself thinking more about your finances.

If you plan to borrow money—maybe for home improvements or to prepare for your new baby—it's important to make sure your budget can handle the loan repayments.

In this blog, we’ll look at what you should know when applying for a loan while pregnant.

Will lenders consider my pregnancy?

Before approving your loan, lenders want to be sure that you can afford the repayments. Although lenders cannot ask you whether you’re expecting a child, they can ask whether your income and expenditure is likely to change. If you or your partner are about to go on maternity or paternity leave, the answer to that question is likely to be ‘yes’.

What lenders look at in your loan application

• Credit history: Lenders will check your credit history to see how well you’ve paid back any loans in the past.
• Money coming in and going out: Lenders want to see if you’re able to repay what you borrow.
• Income changes: Be honest about any expected drops in income. This helps you avoid borrowing more than you can repay.

Is it the right time to apply?

Before applying for a loan, think about whether your budget can include the extra repayments. Pregnancy often leads to changes in income, especially if you plan to take maternity leave.

Budgeting tips

1. Know your budget: Understand how much money you make and spend each month. Remember that this is likely to change once the baby arrives, so don’t forget to factor that in.
2. Use a loan calculator: A loan calculator can tell you how much you’d pay back each month based on the amount, term and interest rates.

Types of loans to think about

If you decide that a loan is right for you, here are two main types to consider:

• Secured loans: These require you to own your own home, which you secure the loan to. This means your home may be at risk if you don’t keep up with repayments.
• Personal loans: These do not require securing, and eligibility is instead focused more on your credit background.

Finding the right loan

Before applying, you can use a soft search tool to compare loans without affecting your credit score. This way, you can see what options you have without leaving a mark on your credit history.

Timing your application

If you have any doubts about whether a change in circumstances will impact your finances, it might be worth holding off applying for a loan for the time being. Lenders may be more willing to lend to you if you have a regular income.

By being honest with lenders and knowing your options, you can make smart choices that work for you and your family.