Mortgage Affordability Criteria

Intel1982

Hi there - I am looking for information on what income can be taken into account with a mortgage application.

My husband works full time and earns a basic wage plus an annual bonus.

I am a stay at home mum/carer of two children, one child receives Child Disability Payment (Scottish equivelent to DLA) and I also get carers allowance and child benefit on top of this - is this income taken into account? The disability benefit/carers allowance is not on an indefinite basis, we have to reapply every two years for this (current award expires February 2024).

Thanks.

kingstreet

It will very from lender to lender. There is no "one size fits all" in the mortgage industry.

I would say you are likely to find the carer's allowance won't be accepted. The disability payment accepted by some and rejected by others if not in your name and child benefit accepted by most.

Intel1982

Thank you!

housebuyer143

Intel1982 said:

Hi there - I am looking for information on what income can be taken into account with a mortgage application.

My husband works full time and earns a basic wage plus an annual bonus.

I am a stay at home mum/carer of two children, one child receives Child Disability Payment (Scottish equivelent to DLA) and I also get carers allowance and child benefit on top of this - is this income taken into account? The disability benefit/carers allowance is not on an indefinite basis, we have to reapply every two years for this (current award expires February 2024).

Thanks.

I used my Childs DLA payments with Skipton. Most do not accept it. 

Skipton do not have the best rates, so it would depend if you need this income included or not to buy the house as to whether to use them. 

Intel1982

Thank you, are Skipton more for people with adverse credit issues?;as we also have some defaults that aren't due to fall off until January 2025. 

housebuyer143

Intel1982 said:

Thank you, are Skipton more for people with adverse credit issues?;as we also have some defaults that aren't due to fall off until January 2025. 

Unfortunately not. I don't believe they accept adverse credit. You can always call and ask them though.

kingstreet

Here you go. Skipton criteria in black & white;-

Credit Defaults

The following is acceptable (subject to overall ‘score’) and providing all other conditions are met:

• 1 default recorded of less than £200
• The default was registered more than 12 months ago
• The default is now satisfied (as evidenced on the credit file)

The following is also acceptable (subject to overall ‘score’) and providing all other conditions are met:

• No more than 2 defaults recorded per applicant and no defaults in the last 3 years
• Total value of the defaults does not exceed more than £3000 per applicant
• All defaults are satisfied at the time of application (as evidenced on the credit file)
• There are no missed payments on any account in the last 6 months
• The application LTV is less than 80%

Please note: We do not accept defaults on certain lending segments including Help to Buy and other government schemes, Discount Purchases, and Debt Consolidation cases.

County/High Court Judgements

The following is acceptable (subject to overall ‘score’) and providing all other conditions are met:

• 1 CCJ less than £500 registered in last 3 years, now satisfied
• 2 CCJ’s up to a total value of £2000 where the latest CCJ was registered more than 3 years ago, now satisfied

Bankruptcy/IVA

The application can be considered where:

• Any Bankruptcy/IVA has been discharged at least 3 years ago
• Applicant is within limits on all revolving/flexible credit lines
• There are no arrears on any account within the last 6 months

Mortgage and Secured credit Arrears

• Applications with any mortgage or secured arrears in the last 6 months will be declined
• Applications with mortgage arrears of more than 2 months in last 2 years will be declined

Unsecured Loan missed payments/credit card/store cards

The application will be declined if:

• There are more than 2 missed payments on any account in last 6 months
• There are more than 2 missed payments on any loan within the last 2 years
• If any account is currently 1 month in arrears (where total balance of accounts is greater than £100)

Bank Account conduct

The application will be declined if:

• Overdraft limit has been exceeded within the latest month
• Credit Bureau report status 1 or worse is reported on any bank account within latest month
• Credit Bureau report status 2 or worse is reported on any bank account within latest 6 months

Credit limits

• If any credit line is reported as over the limit at the time of the search the application will be declined

Payday loans

• If any Payday loan has been used within the last 2 years the application will be declined

Debt Management programmes

• If any accounts are or have been subject to a debt management programme the application will be declined

Intel1982

Thank you, the defaults are from missed mortgage payments on a house my husband owned with an ex partner (a whole other story), the last missed payment was January 2019 so we possibly could still qualify for Skipton 

FashionHeart

Intel1982 said:

Thank you, the defaults are from missed mortgage payments on a house my husband owned with an ex partner (a whole other story), the last missed payment was January 2019 so we possibly could still qualify for Skipton 

The best thing to do is look for an MB (Mortgage Broker) who specialises in those who are in adverse credit.