Use new salary or old to maximise borrowings?

nollag2006

I am currently about to change jobs, which would result in a substantial increase in salary.

In order to maximise the amount I can borrow, am I better off to use my new job offer as the basis for my mortgage application, or use the existing lower salary?

I have been with my current employer for 4 years. I have seen the house that I want, and don’t want to wait around.

On a single salary, I am hoping to get something like 4.5 times (my new) earnings, with a 50% deposit.

Is this feasible, post-credit crunch?

Thanks all !

fluffysox

You might have to use new job, as lenders ask for name and address of your employer- not sure whether they always follow this up though. However we have a similar problem at the mo. Need to remortgage soon as tracker deal ending- but OH is starting new job in a couple of weeks. Problem is mortgage lenders want 3 months payslips. Aaagh!

nollag2006

I havent started the new job yet, which is why I'm querying whether to use the income figure from my new role, or my existing much lower salary

nollag2006

Can anyone advise on this?

_Andy_

Is it 4.5x the old salary or the new one?

sdooley

The problem is that the new job may fail you on the 'stability of employment' test while the existing one (presumably a 5x + multiple) may fail you on the multiple test. It depends on the bank's own underwriting criteria.

The best solution is to go to the bank branch and explain both and ask them which you should put in - the branch staff have every incentive to get your deal through and will know (roughly) the underwriting criteria and you can't be accused of any failure to disclose if you tell them everything...

Although if you could get another 5% off the price it would reduce your mortgage by 10% which might solve your problem too!

nollag2006

Thanks both. The 4.5X is the new salary. It comes in at 5X using the old salary

_Andy_

It's possible, it really depends on you outgoings on debts etc - do you have any other credit commitments?

4.5x income is going to limit you to a few lenders.

nollag2006

Sorry chaps - have just relooked at the figures, its 4.6X under old salary 4.2X under the new one

_Andy_

That's a lot more viable. Again, do you have any credit commitments?

nollag2006

About 9k credit card bill