Impact of late income

Emma991

Hi everyone, long time lurker, first time poster!

We are viewing a house for a second time this afternoon. We love the place and will most likely put in an offer tomorrow morning. However we have a potential issue in our paperwork which is keeping me awake at night worrying about it. After reading all the useful threads on MSE I was hoping someone more experienced could give me their view...

We are first time buyers, with a 35% deposit. We can easily afford the mortgage repayments (even after all other bills and luxuries, we'd still have half of our joint monthly income that just goes into savings). However the company I work for sometimes needs to delay my salary payment by a couple of weeks every once in a while (maybe once every 4 months i'll be paid late). I don't have any concerns over job security; I've been there 4+ years and the company owners are like friends, it's just the nature of the industry and working in a small company.

What this amounts too is that my bank statements sometimes have a missing entry some months (then a double payment at the end of the following month). On top of this i'm furloughed 2 days per week (topped up by the company so I get paid the full amount). Which I worry paints a picture of inconsistent and low job security. On the flip side, my other half has never been paid late and my bank balance is always healthy. I keep a few thousand in my own current account at all times, so I wouldn't even notice a late payment if they didn't tell me.

I know each application is different and each lender is different (we're thinking Barclays at the moment). But has anyone ever been in a similar position? Am I worrying over nothing? How likely are we to get rejected because of this? 

lonibra

Part furlough plus significantly/irregularly delayed salary payments do not make for a straightforward application. In your place I would want to talk to the bank beforehand and explain or use an MB who will do that.

RachP87

Slightly different situation as I haven't had my pay delayed for weeks but I work for a small business and they use an external company for payroll, who are often late sending the details over so my work tends to pay a lump sum in on pay day and then once payslips are back he makes payment for the difference (overtime hours vary every month so not possible to just pay our set salary every month) I had a broker query this and couldn't understand it, he said TSB would not be happy with it.. In the end I went direct with NatWest and they didn't care at all. 

But I am not sure about the furlough part, some banks wont consider applications if you are still on furlough but I guess it depends how much the mortgage relies on your salary for affordability to pay. If you have that much left over each month you might be able to get it just on your partners salary.

Emma991

Thank you for sharing your experience @RachP87

We've seen some lenders won't deal with people on furlough, which has limited us to just a handful of banks. Unfortunately i'm the higher earning partner (by a considerable percentage) so we couldn't just apply based solely on my other halves income.

I managed to get an intro call with an independant mortgage advisor this afternoon who essentially confirmed my suspicion that a mortgage rejection is highly possible unless at least 1 of the 2 negatives change before application. But if we used him he would help us to put as much supporting documentation together to paint the best picture we can.

It's horrible knowing we can afford it but not being able to fit their criteria. I guess we just need to wait and see how things play out though. It's out of our hands and we may not even get our offer accepted anyway!