Circumstances have changed

Baby_A

Hi

We bought a house in Jan 2007 and have a fixed rate mortgage until Jan 2009 with Intelligient Finance. At the time both me and my husband were working full time and earning enough jointly to secure the mortgage. Since then I have had a baby and decided to go for a less paid job (less stressful) and part time to spend time with my baby. We still are able to pay our mortgage payments and havent defaulted on any, but I am concerned that when time comes for us to shop around for a new deal we wont be considered based on our earnings. Will this be the case or will any new mortgage lender look at the fact that we have afforded it all this time.

My main concern is that my husband works in sales and alot of lenders only look at the basic salary when considering, which isnt alot compared to his commission (which although is never guarnateed, he does meet his targets on a regular basis).

Surely alot of people must be in this situation, that their financial situation changes along the way but are still able to afford their payments comfortably?

Sorry, Im thinking out loud and as this is our first house, not sure what to expect in January.

Any advice?

MortgageMamma

Ok

Well without specifics I'm not sure what to tell you but, if you are confortable with Intelligent Finance why not just stay with them on whatever deal they offer you until you are in a position to legitimately support the mortgage on your income again? That way you most likely will no be underwritten again and will save yourself a bit of stress.

Secondly, did you know that lenders often include tax credits as income?

Baby_A

Intelligient Finance at present will be asking for £250 a month more than our current payments, and Id like to be able to get a better deal.

To be honest I dont really want to increase my hours or go back to my old career as I am enjoying the hours I do and time I get at home, unless we need to for affordability reasons, which we dont.

We have included tax credits but funnily enough they take commission into consideration when calculating benefits, but dont when lending!!! Therfore we dont get much.

It annoys me so much that people that are on commission based jobs get screwed over, and makes it difficult for us to declare actual earnings. As if they were to take my husbands commision into consideration, we would have no problems.

grogdog

if may be asking for 250 more but that is probably you moving on to the svr , they should however offer you a deal somewhere between the rate you are on now and svr, but no doubt your payments will incras from the fixed rate you are on currently.

MortgageMamma

there are lenders who will take your husbands commission earnings into account, but whether you would be eligible for these providers is dependant upon your credit history and how much equity you have in your property. Don't tie yourself in knots about this, you need professional advice from a whole of market mortgage adviser - yours sounds like a straightforward case and normally would be, but a lot of mortgage products are being withdrawn by lenders at present and the advice of a good broker is more important now than it ever was.

MM

space_rider

I have a mortgage with Abbey, they do it on affordability but I also had a decent deposit of about 30%.

firesidemaid

are you able to try and put yourselves in a better position financially before then? eg. make overpayments etc or save money towards this so that you will be able to get a better rate/ltv.

do you already maximise your income and minimise your outgoings? have you got all the best deals available on utilities etc?

have you considered posting an soa of incomings and outgoings on this forum to see where there is any room to save money?

i just had a look at your previous posts to see if you had done an soa recently, and i see that you have recently had a holiday and also were potentially buying an ipod and dining room furniture - if you have this kind of money free (and you don't have credit card debts either) then you could 'batten down the hatches' for the next year and use this money to overpay the mortgage.

the more you pay off, the less interest you will pay and if you keep your regular mortgage payments the same then you will be paying even more off. what is your fixed rate and current ltv ?