Pay rise and impact on mortgage application

tarab1986

Howdy. Me and my partner are looking to purchase our first home. We have a 10% deposit available. We will be looking to get an AIP in May once I've cleared my remaining debts. My question is that in June I will be temporarily promoted to cover my boss at work (who is off on maternity leave for 6 months). The pay rise is going to be between 2.5k and 3k per annum. Would this make any difference on a mortgage application? Would they take my higher salary into account even if it's temporary? In affordability terms we can afford to borrow extra hand it would be handy considering house prices in our area) but would the banks actually lend us more?

Any advice is welcome,

pc1271

I would avoid mentioning anything about a temporary position unless they specifically ask or there's some assumption you agree to in the terms/conditions. Do not lie, just give them the facts as they are at the time; you'll have to supply payslips, etc, but if you indicate that your job is 'temporary' in any way they could become very wary.

When we were buying a house my wife was on maternity leave and informed them that she would be doing fewer hours when she returned and gave her post-maternity salary on the application. They were very jumpy about it and insisted on letters from her employer saying that she would be going back and what hours she would do, etc. All completely pointless as you can change your hours or quit your job the day after the mortgage is approved, but they still seem to lack common sense. It all worked out in the end though.

pisco

Hi there,

I've just been through this - I'm currently seconded to a higher-paid position and had to apply for a mortgage. I put down my normal, permanent salary details on the application then hit problems when I was asked to provide proof of salary. The building society insisted I amend my application to reflect my higher salary, despite my repeated insistence that it was temporary!

My advice would be to budget on your usual salary for peace of mind and check with your bank what they want on the application. You want to know you can afford your home, come what may.

Thrugelmir

Returning from maternity leave is a different situation to a six month secondment. A temporary uplift in pay is just that temporary.

tarab1986

Thanks for the advice everyone, I'll keep my broker in the loop and also see what they recommend.