Complicated pay structure - acceptability of overtime and other sources of income (NHS worker)

ola_luna

I was wondering if anyone knows (either through their work as a broker/underwriter or through being in the same situation as me) whether there are still lenders out there who would be willing to accept both overtime income (a large percentage of it) AND bank shift income, as well as a London weighting and child maintenance, when assessing mortgage affordability.

As an NHS worker, my pay structure is unfortunately quite complicated. It is made up of:

• basic pay + London weighting: 50%

• overtime (as part of my main job): 25% (it is slightly variable month to month and not guaranteed per se, however for as long as I have been in this employment - so for the last 3 years - it has been reliable and consistent, and working in the NHS there are always many more shifts available for me to do than I am physically able to work so unlikely to ever dry up and certainly not during a pandemic!)

• bank shift income: 25% (this is technically a second employment in the sense that it is recognised as such by the HMRC, however it is through the same NHS Trust; in the same way as overtime, it is not guaranteed and it is variable but I do have a consistent track record of it over the last 3 years)

Before lockdown started, I was able to secure a mortgage offer to buy my first house using pretty much 100% of all of the above, together with child maintenance (paid into my account every single month without fail by my ex husband for the last 5 years, although it is through a private arrangement rather than a court order). That offer is still in fact valid. However, I am now considering pulling out of that transaction and making an offer on another property instead which would mean a new mortgage application.

Obviously due to Covid-19 most lenders, if not all, have drastically changed their lending criteria. Most don't seem to accept any overtime or extra pay at all; those that do (perhaps as an exception for key workers only) will only accept a small percentage of it (50-60%). It also seems to be the case that even if a lender is willing to accept some overtime, they might not necessarily be inclined to also use income from a secondary employment (so bank shifts in my case) and/or they might only accept child maintenance if it has been arranged by a court order.

Does anyone know whether there might be a lender out there that would consider ALL of the above sources of income at the same time? The property I am hoping to make an offer on is very similarly priced to the one my previous mortgage offer was issued for and my income has not been affected by the pandemic in any way at all (if anything, there is even more work available as a result of it), so it is very disheartening to think that despite there not being any changes at all in my circumstances I might now not be able to afford that similarly priced house whereas I could still buy the original one if I chose to! 

I was originally going to put down a 10% deposit but I am able to increase that to 15% as I am aware that there aren't many 90% LTV deals available at the moment. My only issue is whether I can find a lender happy to recognise ALL of my income.

I am hoping to discuss my (complicated) situation with a broker very soon - I have contacted a couple but have not had much luck with them getting back to me yet, apart from an initial acknowledgement of my enquiry by somebody from the admin team (are brokers swamped with work at the moment and is it normal to have to wait a few days before hearing from them as a new customer?), so I thought I'd post on here while I wait just to see whether there might be hope for me or whether I'm playing a losing game! 

Apologies for the essay

Many thanks in advance if anyone is able to help.

jamielutz1987

@ola_luna

As you have correctly concluded, only a broker will be able to give you an indication of how much you can borrow. Given that you are an NHS employee and that your "second job" is the same as the first, I would be hopeful.

Anecdotally, currently brokers are swamped with customers coming back to them post-lockdown to proceed on stalled purchases so they may be looking at your case and setting it aside as you don't have an offer accepted and the different income streams that need to be considered (as the broker will need to get in touch with a few lenders to see whether your case may be accepted).

In your place, these are some of the things I would do to try get a broker to give me a definitive answer.

1. You have a property in mind, ALWAYS say that you have an offer accepted on it when approaching any broker. I know it's stretching the truth but sometimes that's the only way to get their full attention.

2. Use the free online brokers (Habito, Trussle) for basic, commitment-free advice. Use this as a baseline. With Habito there is a guarantee of being able to speak (live chat) to a broker after completing a full online fact find, either right away or after a 10-15 minute wait (if they are exceptionally busy). Trussle doesn't have a live chat facility but usually do get back within a day or two hours.

3. Try unbiased's matching service, make sure you put in as much detail as you can. A broker that chooses to buy your lead will be serious about it. But you may not get a response if your case is unlikely to be placeable.

csgohan4

I would be weary of free conveyor belt brokers like L+C, especially as you are not straight forwarded and have multiple income streams. They need to find a lender who will take as much of your overtime as possible

dimbo61

As another NHS worker some lenders are being very generous with regard to NHS staff and taking into account Overtime, unsocial hours and bank income but as others have said this is complex so maybe a good local broker who can hold your hand through the process.
They can review your credit file, income, savings, age, kids etc and search the market to see what is available.

ola_luna

Thank you all for taking the time to reply.

@jamielutz1987

Thanks for the tips. That is obviously where I went wrong when trying to get the brokers to look into my case - I was being too honest! Since I still haven't heard from the ones I contacted a few days ago I will try to approach a few more and I might just have to stretch the truth a little this time... I will definitely give Unbiased a go. I was vaguely aware of the website before but didn't really know how it worked so that's very useful. I might try the free online brokers too, especially if there is an option to speak to an actual human too as part of the process, although I did try to use L&C when I was applying for the original mortgage but wasn't able to get anywhere with them at all (see below).

@csgohan4

Yes, I agree with that. My experience with L&C back in Feb/March really wasn't great. I was able to obtain a DIP online easily enough. However, when it came to trying to speak to them to clarify some issues and turn the DIP into an offer it was impossible to get through to them for days on end. Every time I phoned I was told by whoever answered the call that all the advisers were extremely busy but someone would call me back when they could but they never did! Then when eventually (after a week of trying) I did finally get put through to a broker, I found him very unhelpful. It seemed like he hadn't had much experience of dealing with applicants like myself and appeared quite rude and dismissive, implying it's impossible to have so many income streams and questioning whether I ever have a day off, even going as far as asking who is looking after my (teenage) son when I'm at work... And when I emailed him my payslips, at his request, he never actually got back to me. 

@dimbo61

Is that based on your recent experience during the pandemic? If so, that's great and it would definitely give me hope!

joys1

We’ve recently applied and got accepted directly through Nationwide. Partner works for NHS but only London weighting was taken into account - despite the fact that he similarly does overtime on a monthly basis. Stable second job in healthcare but private, currently furloughed, but none of those earnings were considered. 

amnblog

You can expect Lenders to be more conservative with handling overtime in the current environment. If you are an NHS worker however, your additional pay has presumably continued in recent months.
A new property does not necessarily mean a new mortgage transaction.

haras_n0sirrah

I have a number of NHS clients at the moment and the last case I did the lender accepted 60% of bank and overtime type income and 100% London weighting and basic. There are a number of excellent brokers who post here. Why not read the boards and pm someone who you feel gives good advice. We cannot approach forumites but most of us are happy to answer a pm wanting advice