Question about the amount providers will lend?

lil_lisa

I know that the general guide for calculating the amount of mortgage you will be offered is roughly 3 - 3.5 x your annual salary (and as long as you have sufficient deposit/equity), but what exactly do they go by? Is it your contracted salary, payslips or P60's?

The reason I ask is that although my OH's contract is for 19k pa last year with the bonuses he received periodically that was increased to 30k and reversely although my pay is pretty much set each year to the figure stated in my contract I will be on maternity leave for part of next year which will reduce my income for a few months.

This would mean that depending on what they look at our income looks like it varies quite a bit!

Any ideas?

lil_lisa

Can I ask if there's a reason why this has had so many views and no replies? Is it that there's a really obvious answer or is it asked often?

notisis

As I understood it lenders looked at your last 3 months payslips (sometimes they ask for 6 months) but were willing to take overtime/bonus etc into account but you'd have to provide evidence the overtime/bonus was ongoing. As for maternity I'm not sure on that one. I think providing you show last 3 months payslips they lend based on that not future income (unless you know you are about to be made redundant or lose your job).

I'm sure someone with better information will reply soon. Perhaps a broker would be better placed to answer.

herbiesjp

Lats 3 months payslips are needed

Some lenders want P60s as well - others may also want an employment contract.

Not all lenders take bonuses into account if they are not guaranteed.

Out of the ones that do, they may include the bonuses, but at differing amounts i.e 1 lender may take 50% and another lender may take 75%

As for maternity - as long as you are going back to work, you should not have any problem. The lender may want a letter from you and/or the employer to confirm your intentions.

If you go back part time, they will use the reduced income figures.