fbpx

Mortgage Advice Experts

Menu
  • Home
  • Videos
  • Mortgage Calculators
  • Residential
    • Mortgage Deals
    • First Time Buyer
    • Remortgage
    • Right to Buy Mortgage
    • Bad Credit Mortgage
    • Self Employed
    • High Income Multiple
    • Help To Buy Mortgage
    • Gifted Deposit
    • Foreign Nationals
    • Debt Consolidation
    • Equity Release
    • Close
  • Buy to Let
    • Buy to Let Mortgage Deals
    • Buy to Let Tips
    • BTL 80% Loan to value
    • Buy to let Remortgage
    • Let to Buy
    • HMOs
    • Buy to Let with Bad Credit
    • Limited Company
    • Portfolios
    • Holiday Lets
    • Ex Pats
    • Rent to Family Memeber
    • DSS Tenants
    • Into Retirement
    • Foreign Nationals
    • Inherited Property
    • Close
  • Bridging Loans
    • Commercial Mortgage Tips
    • Bridging Loans Explained
    • Why use Bridging Finance
    • Bridging Finance Rates
    • Auction Finance
    • Auction Finance Rates
    • Non Standard Commercials
    • Development Finance
    • Close
  • Protection
    • Will Writing Service
    • Probate Services
    • Close
  • Testimonials
  • About Us
    • Why Niche Advice
    • Our Fees
    • Testimonials
    • Blog
    • Join our Team
    • Privacy Notice
    • Terms and Conditions
    • Close
  • Contact Us
You are here: Home / Mortgages / Getting a Mortgage when you are on maternity leave

by Payam Azadi

Getting a Mortgage when you are on maternity leave

Maternity

Mobuy to let Mortgage Brokerrtgage based on your normal salary whilst on maternity leave

Contrary to popular belief it is possible to get a mortgage based on your normal salary whilst on maternity leave and I have personally helped numerous customers on this basis. To find out what the mortgage lender’s will expect from you read on.

It goes without saying that borrowing to purchase a large property is common when you have just had a child. Suddenly the dimensions of your existing property seem to shrink overnight and you are desperate for a mortgage even though you are in the mists of your maternity leave – so how do you go about it?

Please can I start by saying that your chances of success are much greater if you are organised and do not tend to throw away important financial documents as the chances are that you will need to evidence a variety of pieces of information about the maternity leave if you are to get a mortgage.

Working Off Of Your Normal Salary

Ordinarily the lenders that are active in this market will apply their mortgage affordability assessment based on your normal basic salary. They are unlikely to take into account additional supplements particularly bonuses, overtime or commission which are reliant on you physically being in the place of work to earn them.

The lender’s will need to understand the tapering down of your actual pay for example: 3 months’ full pay, 3 months’ half pay then statutory maternity pay when assessing the viability to provide a mortgage for you.

If the return period is some way off you will need to demonstrate sufficient personal savings to meet the obligatory mortgage payments until you return to work.

Should you plan to return on a part-time basis the new salary will be the source of the affordability assessment.

A Return Date Must Be Set

Simply saying you plan to return to work is insufficient for mortgage purposes. The lenders will seek confirmation that you have had a ‘return’ meeting with your employer and that ‘terms’ have been agreed and a date set.

A letter from the employer is normally a prerequisite to back this up. If you are employed by a family member it is likely the mortgage lender will turn to the company’s Accountant for a response and professional opinion.

Child Care Provision

The lenders want to understand how you intend on looking after the child.

As you are no doubt aware private child care costs can quickly run in the hundreds and this added monthly commitment will be deducted from your salary before applying the affordability multiple.

For example,

Let’s assume the lender’s income multiplier is 4.5, as such the approximate assessment would be:

Basic Salary £30,000
Child care £800 pm (£9,600 pa)

£30,000 – £9,600 x 4.5 = £91,800 maximum mortgage.

If your partner, grand parents etc will be sharing the child care responsibility in full then no deduction will apply.

If you are self employed the lender might question how this extra burden might affect your business capability and seek assurances from your Accountant.

Historical Information Will Be Required

When making a judgement on whether to lender to someone on maternity leave the Mortgage Underwriters apply what I term ‘360 degree’ underwriting. And, it is on this point that many would-be applicants can fall through the net through no fault or their own and where the more organised applicants prosper.

Mortgage Lender’s nearly always ask for payslips and bank statements showing salary credit covering 3 months prior to maternity leave as well as more recent ones. The reason is they want to make sure of the original terms of employment before maternity leave commenced. The bank statement in isolation is insufficient as it will only show a solitary figure and not how it was made up. The Underwriters will be relentless in determining all aspects of pay, for the reasons mentioned above, as the basic salary figure is the prime factor in their calculations.

To conclude your chances of a successful application will often rest with selecting the right lender and help with the positioning of the case in the most favourably way, therefore I would also urge you to use a professional Mortgage Broker, such as Niche Advice.

The nearer you are to finishing the maternity leave the greater the possibility of acceptance. Likewise, a joint application with someone in full time employment will help.

I wish you well, and I’m happy to help if you want to get in contact.

For more information on how we can help you get a mortgage, please contact us on 0207 993 2044 or alternatively complete the simple enquiry form on the top right hand side of this page.

Mortgage Enquiry Online

[contact-form 4 “Enquiry Form – Niche Advice”]

020 7993 2044

Payam Azadi

Author: Payam Azadi

Payam Azadi is a partner at Niche Advice who are whole of the market Independent Mortgage Brokers. His role is very much focused on Property financing both on residential and commercial lines. To get in contact with him please click here.

Twitter Facebook Linkedin

Filed Under: Mortgages Tagged With: can i get a mortgage if i am on maternity leave, having a child and getting a mortgage, maternity getting a mortgage, maternity income for mortgage, Mortgage maternity leave, Mortgage on maternity, wife on maternity leave can we get a mortgage

Proud to be sponsors

Mortgage broker awards

Contact Us

Our Fees

Why Niche Advice

Mortgage Deals

Tools / Calculators

Latest News / Blog

Payam Azadi

Declined Buy to let mortgage due to background property portfolio stress test

The background property portfolio stress test is stopping borrowing more There could be a variety of reasons why you've been turned down for a … [Read More...]

Payam Azadi

Up to 10 times Income Multiple Remortgage

I never thought I'd be writing about 10 times income multiple for a mortgage.Looking back income multiples have come a long way to get to 10 times. … [Read More...]

Payam Azadi

BRRR 85% LTV bridging loan for property refurbishment

BRRR Finance Refurb Projects to 85% LTV bridging on day 1 May be excitement and refurb finance don’t naturally gel together but this 85% Loan to … [Read More...]

AS A MORTGAGE IS SECURED AGAINST YOUR HOME OR PROPERTY, IT COULD BE REPOSSESSED IF YOU DO NOT KEEP UP THE MORTGAGE REPAYMENTS.

If you are thinking of consolidating existing borrowing you should be aware that you may be extending the terms of the debt and increasing the total amount you repay.

Niche Advice Limited is a Credit Broker and does not lend money directly to clients. Niche Advice Limited is authorised and regulated by the Financial Conduct Authority. FCA Number: 750263.

Commercial Buy-to-Let and commercial mortgages are not regulated by the Financial Conduct Authority.

Our Fees

Click here for our fees structure. A full detailed fee plan will accompany all our quotes.

Niche Advice Limited has a commercial arrangement under an affiliate programme with Check My File and is remunerated for referrals.

Terms and Conditions

If you wish to register a complaint, please write to us on the details below or call us on: 020 7993 2044.

Correspondence Address: Niche, Unit F6, The Addington Business Centre, Vulcan Way, New Addington, Surrey CR0 9UG.

A summary of our internal complaints handling procedures for the reasonable and prompt handling of complaints is available on request and if you cannot settle your complaint with us, you may be entitled to refer it to the Financial Ombudsman Service at www.financial-ombudsman.org.uk or by contacting them on 0800 0234567.

Site Terms and Conditions
Customer Privacy Notice

niche youtube

CONTACT NICHE ADVICE
Tel: 020 7993 2044

Registered Office: Niche, Unit F3, The Addington Business Centre, Vulcan Way, New Addington, Surrey CR0 9UG. Registered in England & Wales. Company registration number: 06599033.

Members of The Financial Intermediary & Broker Association - Number SBS36389

logo

© 2022 · Niche Advice Limited · Site Designed by Niche Advice Design Team

Manage Cookie Consent
To provide the best experiences, we use technologies like cookies to store and/or access device information. Consenting to these technologies will allow us to process data such as browsing behaviour or unique IDs on this site. Not consenting or withdrawing consent, may adversely affect certain features and functions.
Functional Always active
The technical storage or access is strictly necessary for the legitimate purpose of enabling the use of a specific service explicitly requested by the subscriber or user, or for the sole purpose of carrying out the transmission of a communication over an electronic communications network.
Preferences
The technical storage or access is necessary for the legitimate purpose of storing preferences that are not requested by the subscriber or user.
Statistics
The technical storage or access that is used exclusively for statistical purposes. The technical storage or access that is used exclusively for anonymous statistical purposes. Without a subpoena, voluntary compliance on the part of your Internet Service Provider, or additional records from a third party, information stored or retrieved for this purpose alone cannot usually be used to identify you.
Marketing
The technical storage or access is required to create user profiles to send advertising, or to track the user on a website or across several websites for similar marketing purposes.
Manage options Manage services Manage vendors Read more about these purposes
View preferences
{title} {title} {title}