Contracted hours Vs worked hours

smc103

My husband and I are hoping to apply for a mortgage in the next few months. However my hourly contract has gone from 45 hours down to 8 hours when I return from maternity leave. 

Will mortgage applications only use my 8 hours of contract hours or my average earnings? I will hopefully be working more like 25 hours. 

Would it be a good idea to apply for a mortgage whilst I'm still on the 45 hour contract? I'm receiving furlough until August.

jamielutz1987

If you apply now, the income used for affordability will be the one that is shown on your furlough payslip. You can only apply for a mortgage once you have had an offer on a property accepted.
Even if you do get an offer based on your current pay, the lender may ask for updated payslips closer to completion and revise/withdraw the offer of pay no longer meets affordability.
If you do apply after your pay is reduced, it will need a track record before average pay or variable pay is taken into consideration, it's unlikely to be ok straight away.
In any case, I would recommend speaking to a broker when it is time.