Household income - how is it looked at if individual incomes differ?

Sanne

Hi All,

We are still at least 1 1/2 years off until we are hopefully in a position to have a large enough deposit but something just crossed my mind.

Say you've got two married couples applying for mortgages. Both have a household income of £65k. In one, it's one partner earning £20k and the other £45k, in the other it's both partners earning equally much (£32.5k each). Do banks make a difference in how much of a mortgage they offer? Assume the credit ratings are perfect for all four. As another extreme you could probably have a married couple with one income of £65k, through they'd obviously have less net than the first two.

Sorry if that's a complete stupid question!

Thrugelmir

Lenders vary in how they arrive at the amounts they are willing to offer. This will be reflected in the interest rates on offer. So it's horses for courses so to speak. In finding a lender who'll offer you a competitive rate based on your specific circumstances.

ACG

Ive never done the sums with any lenders but i suspect in the main it will be the same. The only exception may be if you have one person over the higher tax threshold and and the other not, as opposed to both under the higher tax threshold?

But, does it matter? Your circumstances are what they are. Unless you can change your incomes, its not going to make any difference.

Sanne

ACG wrote: »

But, does it matter? Your circumstances are what they are. Unless you can change your incomes, its not going to make any difference.

Not really - just interested me
I could still kick my other half in the backside .... ;-)

Thrugelmir

Sanne wrote: »

Not really - just interested me
I could still kick my other half in the backside .... ;-)

The real differentials only really occur when you have one non working and one working partner. In this instance the reason is likely to be children. Which then opens up yet another set of possible variations.