Unaccounted for Mortgage Situation

gaz2613

Hi everyone, I am new to these forums and have been a lurker for a while before deciding to join.

Me and my partner are currently in the middle of applying for our first mortgage. We are currently living with parents separately as it was the only way to save quickly enough for our deposit.

I have 11% to put down on a property but as it stands at the moment, my partners tax credits claim is single as we live apart and HMRC refuse to change it to a joint claim unless we are living together.

Now here it comes, a lot of mortgage lenders will only accept tax credits on a joint application if the tax credits award is also joint. But how can you do that if HMRC refuse to make it joint as you dont live together. It seems like a vicious circle.

We have used a broker that charges as we want to get our first application right and have checked all of Natwests terms and conditions and lending criteria and it does not state anywhere that a joint application requires a joint award so we are hoping they will accept part of it if not 100% as I work full time and im on a pretty good salary so only need the tax credits to boost the lending amount slightly.

I have done my sums and we can comfortably live with my wages taking care of the bills and mortgage, I will still have around £400 left each month and thats excluding the tax credits we get which the shopping will be bought out of.

Has anyone else been in a similar situation, living apart with parents, applying for joint mortgage with tax credits in partners name only?

AnotherJoe

Can you or you wife move their addresses to the same address (eg one of the parents) so you are both at the same address. Let’s say it was your wife and she now lives at your parents.

This would of course oniy be for a few months.

Now, it may be that whilst living with you, occasionally she might visit her parents and stay over just like any daughter would do, no harm in that.

gaz2613

Might have to if Natwest doesn't come good for us.

It's a bit rubbish though that lenders have not considered this situation as many people stay at parents to save a deposit!

Jaywood89

I’m afraid the tax credits is a moot point

If u change to a joint claim and are on good money then you won’t get tax credits any longer. The lenders will know this also. By all means I wouldn’t take a chance and use them as they are (single) and see if it works. As far as I know you don’t have to be joint on the claim to class it as income just be aware the lenders may see it as I mentioned before.

Also just a side bar.....£400 minus food might flag high on an unaffordability calculator. We were refused with £1000 left over. This is because (I’m guessing) you have children? They tend to be quiet harsh on affordability with dependants in tow.
Your broker should be doing all the math for you and should be able to answer if u can count the tax credits or not. That’s what he’s being paid for

Good luck and I hope it works out

Jaywood89

Would not wouldn’t. Please excuse my poor grammar

ACG

gaz2613 wrote: »

Now here it comes, a lot of mortgage lenders will only accept tax credits on a joint application if the tax credits award is also joint. But how can you do that if HMRC refuse to make it joint as you dont live together. It seems like a vicious circle.

I am not saying you are wrong, but I have not come up against this issue. It is not something I was ever aware could be a problem so I will bare it in mind for future reference but I think there will be more than just Natwest - for the record, I am not saying natwest are an option, I am just using the example you gave.

It might just be a couple of lenders?

I have come up against something similar and we went on entitledto website which we gave to an underwriter who then agreed the mortgage, but that was a few years ago and far more complicated than what you have described. I do not even know if that site exists/works anymore with all of the changes to universal credit.