School fees and affordability

danielanthony

Hi,

Do all lenders include school fees in their affordability calculations?

I can understand debts being included, as if you don't pay those you can be taken to court, but someone told me that school fees were included in the same way as debts?

kingstreet

Some do, some don't.

Same as childcare.

hcb42

logic would state that they should be part of an affordability calculation, same as any other outgoing.

danielanthony

hcb42 wrote: »

logic would state that they should be part of an affordability calculation, same as any other outgoing.

But they don't, none ask you how much your mobile phone bills are or how much you spend on food each week.

Thrugelmir

School fees are an outgoing. Same as someone who does polo as a pastime.

drdpj

danielanthony wrote: »

But they don't, none ask you how much your mobile phone bills are or how much you spend on food each week.

Actually, they do. I had 4 hours of conversation with Santander and all of these things came up. First for the AIP and then in substantially more detail for the full application.

kingstreet

Come April, outgoings of a discretionary nature will come under as much scrutiny as those which have always been deducted - credit, maintenance etc.

At this moment, what I sad still stands, some lenders take them into account, some don't.

amnblog

danielanthony wrote: »

But they don't, none ask you how much your mobile phone bills are or how much you spend on food each week.

affordability calculations make allowances for normal day to day expenses based on your domestic profile

amnblog

When the changes due to mortgage market review take effect in on 26th April 2014 you can expect lenders to take a much more holistic view to affordability assessments.

School fees are not costs a mortgage broker or lender should ignore.

pinkteapot

Though you'd hope that people would take the kids out of private school before defaulting on their mortgage...

1DayAAT

When borrowing I have always been asked about all monthly expenditure and often childcare and school fees has been given it's own specific area. They have also always asked about how much you spend on everything like food etc in a ballpark way - but generally are more interested in monthly COMMITMENTS - of which childcare/school fees is indeed one. ( I know you have to eat etc too lol but those things can be very variable, like socialising etc can be cut down)