Mortgage in Principle - For someone on Commission, Bonus

reeceg353

Hi All,

Hoping you could help?

I have a mortgage in principle from Halifax to borrow X amount of money which was based on 3 months of payslips as well as my partners.

I am in sales, so a large portion (probably 50%) of my income is based on commission and bonus. I provided 3 months of payslips for May, June and July this year and we were granted a mortgage in principle for more a much larger amount than what we were looking for. To clarify, we don't want to go anywhere near our max borrowing. 

However, August's pay slip for myself was solely base salary as per the line of work i'm in; there is a lull in sales for the month of August where a lot of our clients are away on holiday and therefore deals aren't really made until September.

My question is; will Halifax ask for the most recent payslip once we actually go for full mortgage or will they accept the 3 months I gave once we had our mortgage in principle accepted?

If they decide to offer us less on borrowing, can I go back to them with 6 months worth of payslips (or a p60) to prove there is a slight lull in August but overall my earning throughout the year remain steady and consistent?

K_S

@reeceg353 To answer your questions first (please note that this is for intermediary apps, I have no idea how Halifax direct applications work) -

- you will need to provide the latest 3 payslips at the time of the application. Halifax will take the average of the variable component, annualise it and consider 60% of it for affordability

- no, afaik they will rely on the latest 3 months only. If one of these payslips is missing a monthly bonus/commission, that'll be taken as 0 for the purpose of annualising the variable component

The above is specific to Halifax, lender criteria/policy for BOC (Bonus Overtime Commission) and respective evidence requirements vary quite a bit depending on the specific lender.

Is there any particular reason you are limiting yourself to Halifax? Whenever it is time for you to buy, it may or may not be the most cost-effective in the market. It might be worth considering using a whole of market broker when it's time to apply to ensure that you are getting the best rate. The MSE guide here can help you find one
https://www.moneysavingexpert.com/mortgages/best-mortgages-cashback/#step3 

reeceg353 said:

Hi All,

Hoping you could help?

I have a mortgage in principle from Halifax to borrow X amount of money which was based on 3 months of payslips as well as my partners.

I am in sales, so a large portion (probably 50%) of my income is based on commission and bonus. I provided 3 months of payslips for May, June and July this year and we were granted a mortgage in principle for more a much larger amount than what we were looking for. To clarify, we don't want to go anywhere near our max borrowing. 

However, August's pay slip for myself was solely base salary as per the line of work i'm in; there is a lull in sales for the month of August where a lot of our clients are away on holiday and therefore deals aren't really made until September.

My question is; will Halifax ask for the most recent payslip once we actually go for full mortgage or will they accept the 3 months I gave once we had our mortgage in principle accepted?

If they decide to offer us less on borrowing, can I go back to them with 6 months worth of payslips (or a p60) to prove there is a slight lull in August but overall my earning throughout the year remain steady and consistent?