Mortgage affordability question

Loopy28

Hi, I hope someone might be able to help?

I am worried about these new affordability checks when I move home and ask to increase my mortgage. They ask for outgoings, which for me are higher because I have a large amount of monthly work expenses including fuel (c£500 month) that I pay out but this is reimbursed to me in my monthly salary.

Santander don't take expenses in to account as income (understandably) but if they are looking at total outgoings on my bank statement, they will be significantly higher due to these expenses.

I also had 3 weeks leave in August so didn't receive my regular overtime that month and also spent much more as I was with family.

I did phone Santander but the person really didn't offer much help.

In your experiences, will they consider these sorts of things?

Thrugelmir

Loopy28 wrote: »

I also had 3 weeks leave in August so didn't receive my regular overtime that month and also spent much more as I was with family.

Precisely the point of affordability checks by lenders. No point in kidding yourself either. Draw up your own SOA and see what's affordable to you.

kingstreet

Use a lender less anal about your expenditure and can see you are reimbursed out of pocket expenses?

Alternatively, get a broker to do it for you who can explain when submitting the case that your outgoings are balanced by the reimbursement.

Having reimbursement of expenses is not the same as having it treated as income. If you ask the wrong question of a lender employee, you will increase the chance of a wrong answer.

Kitten_Pie

We went with Santander and our income was very different as it was the month our travel loan came in. They only wanted one months bank statements and the broker advised of the difference it would usually be. All came through really quickly.

Bouncybubbles

Hi
We have just completed with a santander mortgage yesterday! We went through a broker and didn't have to supply any bank statements at all. All we gave them was ID and wageslips/P60. Now by all means this may not happen for everyone but just thought I would share my experience. I am in overdraft every month £200. And our credit is 'good' rather than excellent. So by all means we are not perfect clients. And also we borrowed right on the edge of what we could go to due to relatively high outgoings etc. But again each case is individual

Loopy28

Hi and thanks for your replies and really good to hear peoples real experiences who have used Santander.

I am already with them but my mortgage is only for 50k at present and I looking to borrow 150k. My disposable income per month after absolutely everything is paid out e.g. bills, food, travel, expenses, luxuries is £1700 and I am looking at a £800 mortgage out of that leaving £900 as 'spare cash'.

Perhaps I am panicking over nothing, I think the suggestion of using a broker to port my mortgage and request the additional funds is a good idea although if I go through Santander it is free but I believe most brokers will make a charge?

ACG

The key word here is YOUR expenditure.
YOUR expenditure is not work expenditure.

Declare what you spend on personal use. No lender will allow you to include expenses as income but likewise they are not going to penalise you for them. They may get questioned but if they do just explain and show them where the money is reimbursed - job done.

As for your bonuses/overtime - most will want a P60 to show what you earnt in the last year and then they will take a portion of that - its very rare they will look at the last month or 2 and go off that.

If in doubt, use a broker. Were in jobs for a reason.

Propertyauthor

Applying for a mortgage is nothing to fear, they want your business, they just want to make sure you can afford the property now and in the future.

This is where a good broker can help, they know your circumstances and can match you to the right lender, it's what they do.

Being open and honest is the most important thing as you don't want to borrow money you then can't afford to pay back and end up losing the property.