Husband's income regular but not guaranteed - will we get a mortgage??

CuteMole

Hi there,

My husband and I are looking to buy our first house (we've been married for 13 years and renting together for 15!!!).

I have a stable, secure (as much as it can be in this day and age!!) job and earn £29,500 pa. My husband has a casual '0' hours contract but has been consistently working at the same company on many short term, fixed contracts for the last 8 years. His income varies from month to month, year to year. His last 4 P60s show income of:
2012 - £17,791
2013 - £16,422
2014 - £16,110
2015 - £19,447
It is 'likely' that his income will remain at a similar rate for the foreseeable future, but obviously not 'guaranteed', and the employer isn't in a position to offer a permanent contract. We have a £35,000 deposit (plus approx £5,000 available for fees/extras etc.), no debt at all and excellent credit ratings. So I think we'd be a good bet for lenders!

We are wanting to get started looking at properties and mortgages but our question is this - will lenders take this income into account? Or are we only able to use my income and therefore only qualify for a smaller mortgage? Would a mortgage broker be able to find us a lender who would include it?

Any advice greatly received!

Thanks!

Senior_Paper_Monitor

There are lenders who will look at this - a broker will know the likely runners and present it in the best light for the relevant one(s).

CuteMole

Thanks for the quick reply.

Do you think our banks might appreciate our situation? We've both been with our current banks for a good while.

I have done an internet search (including my husband's income) and there are some quite favourable mortgages out there, but I don't want to apply over internet if we might get rejected? I was going to talk to a broker anyway to get an idea but should I do this first? (Just checking all bases as per MSE guidelines!!!)

ACG

Speak to a broker to start with, there will likel be lenders for it but possibly not every lender... Although you do not say how much you want to borrow so your income alone could theoretically be enough.

From a "legal" point of view, I am pretty sure if he has been employed by the same company for 2 years plus then he would have the same rights (ie redundancy, sick pay etc) as any other "normal" employee. So the employer is possibly no better off by doing things this way.

CuteMole

Thanks ACG!

We're looking to borrow approx £150,000.

My husband's work has had some breaks in service i.e.. 3mths work, followed by 4 weeks no work, followed by 3 weeks work, followed by 2 weeks no work, followed by 6 weeks work etc. etc. By our understanding this means he doesn't get all the full employee benefits.
He gets paid monthly in arrears and has continuously had monthly payslips for 8 years! Some with a lot of pay some with a little!! It works for us, pays very well and can be very flexible but only now, when a mortgage is on the cards, are we worrying about the lack of permanent contract and guaranteed future income!!

CuteMole

Resurrecting my old thread as things have moved on.

10/7/15: Phoned L&C Mortgages and explained hubby's situation. Adviser said 'some' lenders do take into account zero hours contracts. Was given a DIP the same day (£150,000 possibly up to £190,000)

Found property.
5/8/15: Offer of £169,500 accepted. We have 20% deposit (£33,900) so need to borrow £135,600 (over 25yrs)

6/8/15: Phone L&C to inform our adviser of accepted offer. Go through answers to some questions where I point out about my hubby's work contracts. Bearing in mind this is the same person who I spoke to last month, he says "oh no, zero hours contracts are an absolute nightmare".

This has freaked me out and now I'm scared we won't get a mortgage. We are waiting to hear about his recommendations.

My questions are these:
We got a DIP, surely this means L&C were confident they could find us a lender based on the info I gave them?
Do any broker peeps out there know which lenders might look favourably on our situation?

Any reassurance at this stage would be very welcome!!!

Thrugelmir

CuteMole wrote: »

My husband's work has had some breaks in service i.e.. 3mths work, followed by 4 weeks no work, followed by 3 weeks work, followed by 2 weeks no work, followed by 6 weeks work etc. etc. By our understanding this means he doesn't get all the full employee benefits.

Is holiday pay paid during the "breaks". i.e. as it accrues.

CuteMole

Yes, holiday pay is accrued and usually paid at the end of each contract/block of work. So sometimes the holiday pay 'stacks up' to a decent amount ie. after 3mth contract, but then is pretty minimal after a short contract.

Forgot to say his current contract ends on Friday 21st August (mortgage adviser seemed horrified that there was only 2 weeks of a contract left!) BUT his next contract (due to be sent out next week) starts Monday 24th August and runs until the end of November. Then another contract (again being sent out next week) starts mid-Nov (he's on two different casual positions in the same company) and runs until end of Jan 2016....when another contract is 'likely' to be started from. As he is on zero hours the number of hours he works during these contracts varies hugely - some weeks 12hrs - some weeks 60hrs (which does get paid overtime).

I know it sounds confusing - we both work in a Theatre and the nature and size of shows coming in and out dictates when he is required.

goldcd

Speaking from a complete position of ignorance.
Would it make sense for your husband to register himself as a company?
He'd no longer have breaks in employment (unless he fires himself) - and could simply be self-employed with his personal earnings smoothed out to just slightly varying annual income.

CuteMole

goldcd wrote: »

Speaking from a complete position of ignorance.
Would it make sense for your husband to register himself as a company?
He'd no longer have breaks in employment (unless he fires himself) - and could simply be self-employed with his personal earnings smoothed out to just slightly varying annual income.

He would then have to invoice the company (local authority) for his work, but isn't self-employment a hindrance to getting a mortgage too?? (No accounts etc.) He likes being 'employed' ie. PAYE tax, NI, holiday pay, eligible for workplace pension etc. and the job he has is well paid (for our sector/type of work) it's pretty flexible and he enjoys it.....just makes it a bit difficult to 'prove' that his income is 'likely' to stay around the same level for the foreseeable future - which, I'm guessing, is what lenders want to know

PixelPound

The problem with L&C is they want straight forward cases - thy work on a volume basis, so whoever you spoke too might not be too keen if your case is going to take more of their time up.

Try a local broker?