Mortgage, moving and babies

MB1919

Here is my situation. Apologies for the length of the post.

I may be starting a new job in a different part of the country on 1 August and would be getting a substantial pay rise as a result. My salary will be £68,000 if I get the job (and I stand a 50/50 chance, so I’m really trying to plan ahead). I currently earn £49,000 per annum. However, my wife will not immediately seek employment as we look to settle into our new environment, so we will suffer a slight drop in income. She currently earns around £22,000.

We have a 2 year old son, who will be almost three by the time we move house. We would like to have another child as soon as possible, and have started to consider the possibility of that baby being born around October/November 2012 (obviously that relies on a number of factors!). My wife would therefore take at least a year out of paid employment.

A few questions therefore.

1. How much could we realistically expect to borrow? We both have very good credit histories, and no debt whatsoever, apart from the current mortgage! Would it be based on my new income, and how many dependents would come into the equation (assuming my wife is around 6 months pregnant when we move)? Do we have to inform the mortgage company that we are expecting another child? If so, I would of course comply.

2. This is the wrong board to ask this question, but here goes anyway. If my wife remains in employment right up until we move house, would she still be entitled to statutory maternity pay even though she has no intention of going back to work for a while? If so, would the SMP be taken into consideration when making a mortgage application?

Of course, it may make sense for us to delay trying for another baby and it would certainly make the move easier if my wife was not pregnant. I just simply want to do the maths to see if we can realistically borrow enough money to get a good house in what is an expensive part of the country.

The long and short of it is that we need to have some idea about what value of property we should be looking at, and the whole situation is complicated by the possible arrival of a second child even if the current situation is still hypothetical!

One last thing – wish me luck in the interview! It’s on Tuesday.

Senior_Paper_Monitor

The fact that the property is in another part of teh country is likely to stir a few grey cells in even the most dormant underwriter - and questions will be asked about future jobs/incomes.

As to the 'tactic' on maternity pay, I won't comment.

dimbo61

Good luck on tuesday!
Why not see if you get the job first and then ask about relocation expenses IF you get the job.
You have to sell your current home which could take months or rent it out and see where you want to live when you move area by renting yourself for 6/12 months.
You may love/hate the new area so take your time to search for the right home!

ALIBOBSY

My understanding is you get the basic statutory maternity pay even if you don't go back to work (as long as you meet the qualifying criteria). But if her employer pays an enhanced maternity pay it is repayable if she doesn't go back after saying she would.
I would consider exactly where you want to be if you get the job. It may be an expensive area imediately where the job is, but could a commute of say 40-45 mins (not unreasonable) move your house searches to a more reasonable area.
Is it so far you couldn't commute for say the next couple of years whilst your wife has the baby and perhaps starts working again?

Good luck with the interview.

ali x

MB1919

Senior_Paper_Monitor wrote: »

The fact that the property is in another part of teh country is likely to stir a few grey cells in even the most dormant underwriter - and questions will be asked about future jobs/incomes.

As to the 'tactic' on maternity pay, I won't comment.

I understand your first comment, and particularly in the present climate it is not unexpected. That is why I have considered perhaps renting for a while first.

I'm not sure I fully understand your second comment about the 'tactic' to pursue, although I assume it would probably involve my wife alerting her employer as late as possible that she won't be returning to work.

dimbo61 wrote: »

Good luck on tuesday!
Why not see if you get the job first and then ask about relocation expenses IF you get the job.
You have to sell your current home which could take months or rent it out and see where you want to live when you move area by renting yourself for 6/12 months.
You may love/hate the new area so take your time to search for the right home!

I know I am rather jumping the gun, and I will ask about relocation expenses. At least if I do get the job then we will have plenty of time to sell the house. Selling here and buying there may prove a step too far, so renting may be a possibility.

I know the new area quite well having lived there many years ago, although the types of houses I will be looking at now are nothing like my rented hovel from yesteryear.

ALIBOBSY wrote: »

My understanding is you get the basic statutory maternity pay even if you don't go back to work (as long as you meet the qualifying criteria). But if her employer pays an enhanced maternity pay it is repayable if she doesn't go back after saying she would.
I would consider exactly where you want to be if you get the job. It may be an expensive area imediately where the job is, but could a commute of say 40-45 mins (not unreasonable) move your house searches to a more reasonable area.
Is it so far you couldn't commute for say the next couple of years whilst your wife has the baby and perhaps starts working again?

Good luck with the interview.

ali x

A commute of 45 minutes would certainly open up more possibilities. The only problem would be that I will be working very long days, probably looking to start at 7am. The new area is over 250 miles away from where we currently live.

I'm starting to come round to the idea that we'd be better off selling our current house, renting a property reasonably close to work and delaying the new baby by a year or so. Selling our current house could be the major hurdle to overcome.

Thank you for all the replies so far and the good luck messages. I'm still just a little bit confused on the SMP issue, but to be fair we are all dealing in hypotheticals at this stage.

mysk_girl

If you are working for your employer continuously between weeks -1 (ie one week BEFORE you fall pregnant) and week 25, you are entitled to SMP, which can commence no earlier than week 29. This does not have to be paid back if you do not return. Don't forget your wife will also accrue paid annual leave while on mat leave and is entitled to be paid for this as well. Watch where the leave year falls as you aren't entitled to carry it over, so tacking it on at the beginning is the way to go there, and delaying the start of mat leave. Mat leave may start no later than the birth of the baby. This is based on research I did 18 months ago when pregnant and looking at maternity leave, so the rules may have changed. Directgov is a good source, I found.

I doubt any mortgage company would take it into account as it only last 39 weeks, which is nothing over a 25 year mortgage

Good luck with the job :-)

Thrugelmir

Personally I would take one step at a time.

Get the job.

Sell the house.

Go from there.

Life is never predictable.