Mortgage application whilst on Mat Leave?

Tiznow

Hi,

We're in the process of moving house. Importantly my Mrs is on Mat Leave until the Summer of 2014. We had a meeting with Nationwide yesterday as we'd heard they were the most flexible regarding lending at a woman's full return to work salary. This was all going fine until we produced the letter from her work detailing that she would be returning part time (3/5th's) for 12 weeks from June before returning to full time in Sept. She is a teacher so this worked well for all parties. The broker was of the opinion that they would take the return to work figure as her salary and not her full time figure. He also implied that if she just returned full time in Sept they would use the full figure. It was purely a numbers on a page decision. He phoned an underwriter and she hesitated before saying they'd prob use the lower figure.

So they'd basically lend more if she was off until Sept rather than going back earlier to earn some money to help pay the mortgage. This to mean seems utterly ridiculous. How would you guys proceed? One option is to omit our future childcare costs from our application- anyone done this before?

Cheers in advance.

kingstreet

If off on maternity leave, one of the first questions you'll be asked is your future childcare cost on your partner's return to work.

Tiznow

Can we not say family will be looking after them? Any views on the letter? Surely anyone with a brain/authority would look at the two eventualities and realise that the June part time return is a safer bet than someone just returning full time in Sept?

Tiznow

We are looking at around 65% LTV if that makes any difference.

KolaKube

We've just got a mortgage approved through nationwide. I'm currently on mat leave and will be returning full time in Jan 2014 - like you, I had to get a letter from work detailing my return to work arrangements and salary - I'm going back directly full time though.

Might be worth going in branch to apply, we went through it that way and it was helpful as the in branch advisor was able to ring directly and discuss things with the mortgage team

Kola

Tiznow

That's what we did but I got the impression neither the advisor or the underwriter he spoke had the ability to apply common sense to the data in front of them.

Annisele

Tiznow wrote: »

One option is to omit our future childcare costs from our application- anyone done this before?

If you're asked, you have to answer honestly - anything else is mortgage fraud.

If you're not asked, then you don't have to say anything at all about your childcare costs - but as Kingstreet says, you will be asked!

You might choose to take a view on the risks associated with making a fraudulent application - but you won't find anybody here advocating fraud. You might also consider how easy it would be for your wife to get a job as a teacher when a fraud conviction comes up on her record.

I know that what I've said sounds extremely harsh - and you'll probably be offended by it - but the casual nature of your questions suggests to me you hadn't thought through the implications. Better to find them out now than later!

kingstreet

Nationwide policy is as follows;-

- obtain last payslip from before leave started

- obtain letter from applicant confirming return to work date

- obtain employer's reference to check continuing income after return.

In this case, the employer's reference has indicated a lower income level and Nationwide will take and use this, as it will assume when she returns to work she may decide not to return to full time hours and it does not want to run the risk of the case falling outside affordability in the longer term.

As mentioned it also carries out childcare verification from return.

A change of lender may be the only option.

Tiznow

Surely we can just say we intended to have relatives look after them but that fell through. I'd like to see them try and pin that on us. We're not taking a big punt here. We both have good jobs and are stumping up a large deposit- they'll lend to far worse overall packages without blinking an eye. But in this case cos of a number on a page they're causing us a big headache.

amnblog

Tiz

This is not about whether you are likely to be able to afford the mortgage and are likely to pay it.

This is about the Lender adhering to the underwriting rules they run on and the processes they have submitted to the Regulator.

You cannot expect them to take a view and make adjustments on a particular case. The rules must be followed or they will be exposed to big regulatory fines.

You need to find another lender, or have a broker find one for you.

Incidentally - this sentence is a worry

"Surely we can just say we intended to have relatives look after them but that fell through."

Thrugelmir

Tiznow wrote: »

I'd like to see them try and pin that on us. .

Lenders are far better at assessing affordability than many borrowers. As borrowers take the optimistic view that the next 25 years is going to pass financially untroubled. Of course over such a time span there's simply no way of predicting.