Impending redundancy - can I get a mortgage?

amnblog

Why would you being looking to get a mortgage when you do not know where the income is coming from to pay for it in 24 months time?

bazzabear

There are various answers to that.

I have a guaranteed income for ~4 years, which I see as better than most permanent employees, not worse. Do you know for sure that you will have your job still in 4 years?

I am confident of replacing the income. Certainly within the 21 months for which my redundancy will cover my income.

I have been planning the house move for some time, since before this re-organisation was announced.

On balance, I don't think that putting my plans and life on hold is the right approach. I shouldn't get a mortgage for the next 2 years while waiting to be made redundant? Clearly I shouldn't get it when I am redundant. What about when I have the new job, but it's still new? How long should I wait before I'm certain it's stable/ What about if I end up as a contractor rather than permanent - then I can never feel that it's stable, should I continue to refuse to move house in that situation?

amnblog

Then why did you tell lenders that you expect a reduction in income.


If you expect to replace your income there will not be a reduction.

bazzabear

Aha! We're getting to the nub of the matter.

I did not tell the provider that I expect a reduction. I told them my situation, and that I do not expect a reduction, but that in order to know whether they would lend to me I clearly need to know whether they agree with my stance.

Given the wording of the question, I do not feel that I can just not mention my situation.

Bonfire_Bride

bazzabear wrote: »

Ah well. When I do get made redundant, I get a significant pay off, so I wouldn't agree that it's a no-brainer.

Until this mortgage issue, I would have argued it's a no-brainer in the other direction - to stay until made redundant. I still think that is the better option currently.

Exactly!...I would also hang on in there to be honest, especially if you believe it shouldnt be too difficult to find a new job with same wage etc.

What I would advise however, is if you take out any mortgage insurance, do not expect them to cover your redundancy as you would have been reasonably aware of this occuring.

I dont believe it should stop you getting a mortgage...the question is...when is disclosure neccessary? 2+ years down the line is a long way away.

My husband left a job (and country) after waiting 2 years to be made redundant (as he was advised this was going to happen).....

10 years later.....the business is still going! :rotfl:

wrkactjob

I think the question we were asked was something along the lines of "are you aware of any event occurring which will effect your ability to pay?"

As far as you are concerned you are in full time paid employment, you have not received any required legal documentation that accompanies the redundancy process and even if you were to be made redundant you would still retain the ability to pay.

The mortgage process is difficult enough without opening up any potential cans of worms.

PS Actually looking at the application form it asks the question "Are you under notice of redundancy" You are not under notice.

Notice of redundancy

If you are being dismissed for redundancy, you have the right to notice. You must be given:

• one week's notice if you’ve been employed for at least one month but less than two years
• if you've been employed for at least two years, one week for each complete year of employment, up to a maximum of twelve weeks.

getmore4less

bazzabear wrote: »

They have consulted, I will be made redundant. They are moving, and I am not moving with them.

Why make that decision now, if there is the offer of a job at the new location you are in a position to maintain income, (or are they saying you can't go?)

That would be my default so you can say no for now to any questions regarding income/redundancy and review when you are actually made redundant.

Thrugelmir

bazzabear wrote: »

They have consulted, I will be made redundant. They are moving, and I am not moving with them.

If the terms of your potential redundancy are contractual then provide this information as well. Then there's a complete picture.

bazzabear

Thanks all for the replies, everything posted here (going right back to the first post) is helping me to gather my thoughts about the situation, what I need to tell the lenders, how to phrase it, and what I need to ask of them. Really appreciated!

Wrkactjob - "Notice of redundancy" is certainly a phrase I need to remember, and use in my meeting with the bank today (in order to tell them that I am not under it!)
However (and I suspect that the banks have relatively recently changed to this), the question you were asked is not the question I was asked. It was definitely around awareness of a potential drop in income. Whether my situation can fairly be described in that way is the point in question I think.

getmore4less - We went through 'diagnostic meetings' at our company, where we were helped to think about our decision for whether to move with the company. I have gone through that process, and have officially told the company that I will not be going. From their point of view it is therefore decided. But there's nothing official or legal to say so.

Thrugelmir - Do you mean tell the bank that when I'm made redundant, I will get x times my salary? I do intend to do so. But you're right that I can strengthen that message by stating that this is contractually set.


If Natwest have the same stance as One (possibly likely, as they're the same group - but I'm hopeful I can explain things better), then I suppose my next move is probably a financial advisor, as they might have a better understanding of the situation and knowledge of which lenders will be more understanding.

Thrugelmir

bazzabear wrote: »

Thrugelmir - Do you mean tell the bank that when I'm made redundant, I will get x times my salary? I do intend to do so. But you're right that I can strengthen that message by stating that this is contractually set.

Why not at the outset. Put all the cards on the table. Underwriters can then make an informed decision. With sufficient income to last 18 months as unemployed. Then you've plenty of time in which to make decisions.