Affect of OH's maternity leave on mortgage renewal?

2latenow

Our fixed rate (5.09%) ends in October so I am starting to look around at possible alternatives. As first step in research I'm off to see their tied sales person .. sorry... adviser... this week.

My wife has recently started maternity leave and I am trying to find our what affect this will have on what the bank might offer.

The mortgage is joint and at the time it was taken out was exactly 3x joint salary. With OH on maternity leave, will the banks now consider her income 0, so calculating in a sole income?

Based on just my income, the mortgage is about 3.9x . In the (silly) past, banks allowed stupidly high multipliers (I recall hearing 6x ), but in the current times are they now reverting to the old 3.5x ??


I dont see LTV as an issue - it is definately no more than 60% or 65% LTV (based on a very pessimistic estimate of drops since we bought last year). Also we are currently overpaid by more than 3 monthly payments (will be >6 monthly payment by October), so hopefully they wouldn't see it as high risk.

With all of this, it the lender likely to only offer less attrative (e.g higher %) rates due to the now-higher salary multiplier ?? Or just SVR or worse (require a reduction of the loan amount) ?

I'd appreciate ideas of what to expect!

:question:

LilacPixie

I don't know for sure but I am also on maternity leave. Earlier this year we toyed with the idea of selling up and buying a bigger place and our adviser told us that even tho i would be on maternity leave I was still employed and as long as I intended on going back to work there would not be an issue with obtaining a mortgage offer using our joint salary.

We never go as far as verifying this with an actual lender as we realised that moving in a falling market wasn't the best idea ever so we are riding the storm in a home that we can comfortably afford while over paying mortgage and trying to build up a nice deposit.

2latenow

thanks... that gives me some hope !

hostman

LilacPixie wrote: »

I don't know for sure but I am also on maternity leave. Earlier this year we toyed with the idea of selling up and buying a bigger place and our adviser told us that even tho i would be on maternity leave I was still employed and as long as I intended on going back to work there would not be an issue with obtaining a mortgage offer using our joint salary.

We've been given the same advice by our advisor. My partner is on maternity leave until May 2009 (the baby is being stubborn, overdue by over a week). We're going through our first mortgage application and we were told its not a problem, they will calculate income as before, in fact its not even asked by the lender (Nationwide).

Rightly or wrongly, that's how it is.