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AIBU?

Share your dilemmas and get honest opinions from other Mumsnetters.

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Original poster

To lie about having no childcare to the mortgage lender?

83 replies

Toastyapples · 02/08/2020 07:02

We have applied for a bigger mortgage with the same provider as we need to port our existing mortgage to avoid the early repayment charge. It means that we will need to remortgage that part of the mortgage at the end of next year. I'm currently on maternity leave and this hasn't been a problem as I have a letter from my employer confirming arrangements to go back on the same salary etc.
We are lying in our application by saying we will not have any childcare costs next year when I return to work. We're pushing the amount that they will lend us to the limit, not because we can't actually afford it but because the lenders don't like that my husband is self employed and will loan us far less than we can actually afford. The new monthly mortgage payment is only £50 more than we are currently paying because we have been overpaying for the last 2 years. We know exactly how much childcare will cost and have actually budgeted for a £2 an hour increase in price just in case and a loan that my husband is paying will have cleared freeing up £450 a month before we need to remortgage next year.
We've been very lucky that Covid hasn't impacted my husband and he's worked throughout and I'm NHS so my job is secure. Even in the worst case scenario, I could afford the repayments myself if my husband stopped work to stay home with DS so we do know we can afford this mortgage comfortably before anyone wants to tell me that I'm being stupid applying for a mortgage I might not be able to afford... My worry is not that we can't afford it but that we'll be penalised for obviously lying at this stage about having no childcare costs when I go back to work. We were just going to say that our parents circumstances changed so we had to choose paid for childcare instead.
Will we have problems remortgaging because of this?

OP posts:

Ethelfleda · 02/08/2020 07:52

OP you sound like you have your finances under control. I would do the same in your situation.

Flamingolingo · 02/08/2020 07:53

When we remortgaged with nationwide I was pregnant with DC2 (early pregnancy) and answered no to the question about was there anything that would change our living costs/ability to repay (I figured that being pregnant didn’t guarantee a living baby so it wasn’t unreasonable to answer no). When we bought this house last year I’m pretty sure NatWest didn’t ask about childcare costs, which surprised me. But we pay ours on the credit card so they are sort of hidden - they didn’t ask to see detailed statements just proof of no outstanding debts and 3 months of all of our bank accounts

caoraich · 02/08/2020 07:54

We did this last year
I was on ML and we had budgeted not only for childcare fees but for me to go part time after using up accrued annual leave. Similarly I could afford the mortgage myself on a PT salary.
Has not been problematic at all and we were in the position of having to take out a new and port the old mortgage. When I re-negotiated the rate on the "old" bit of the mortgage earlier this year they didn't ask any questions about childcare at all.

Flamingolingo · 02/08/2020 07:54

I also remember being quite panicky because we had had some really high credit card bills paying for two holidays and also some house related stuff eg survey etc (it was a ramshackle old pile we had the survey done before we committed to proceeding). They were very chilled and said it’s our money and we choose how to spend it, they’re just checking the numbers add up and no other hidden debt.

WhentheDealGoesDown · 02/08/2020 07:54

Childcare is one of those things that can change anyway, you have no way of knowing what will happen in the future.

Scarlettpixie · 02/08/2020 07:56

How will they know? They won’t come back next year and ask about your outgoings so long as you keep up with the repayments.

Ethelfleda · 02/08/2020 07:57

They may check your bank statements so I wouldn’t lie

They are going to check OP’s bank statements from the future? Do mortgage lenders have access to a Delorean now?

NoIDontWatchLoveIsland · 02/08/2020 07:58

I think its unfair that they ask about future intentions. If everyone was completely honest we would nearly all say we planned children in future and far fewer people would get a mortgage!

Enderman · 02/08/2020 07:58

We did this. I was on maternity leave at the time. We just didn’t mention the kids would be starting nursery.

larrythelizard · 02/08/2020 07:59

We took out a new fixed term whilst I was on maternity leave and they didn't ask about childcare at all, other than to suggest a longer fix (5 not 3 years) so that by the time we came to that we'd be through the nursery years.

Canyousewcushions · 02/08/2020 08:03

You may well end up issues with affordability when you come to remortgage, and have childcare showing up in your financial information.

It's worth checking you will be OK on their SVR (Plus a bit for continfency) in case you end up stuck on it until you finish paying for child care.

NatalieH2220 · 02/08/2020 08:03

Sounds ok to me, others have said circumstances change and what's to say you will have childcare once the mortgage is in place! It's good to know they weren't concerned re you being on maternity as I'll be in the same position next year when on leave with my second as our remortgage is due.

Sounds like you've calculated everything properly and you can afford it which is the main thing.

AlternativePerspective · 02/08/2020 08:04

I wouldn’t. Not because I think it’s lying or fraud or anything like that, but because childcare is such a huge expense that the difference between an income with and without childcare is so great. Added to which the current climate is so incredibly uncertain, especially if you’re self employed.

One of the reasons why mortgage lenders are so risk averse is because so many people over borrowed in the 90’s and the impact was huge.

That being said, please don’t think that because a mortgage lender tells you to lie they’re doing it for your benefit. They’re doing it because they make commission on every mortgage they sell, and that will happen regardless of the amount of debt you end up in.

When my DP applied for a mortgage when he was still with his ex, he had a small sideline which he actually rarely did, maybe a couple of hundred.a year, but the mortgage adviser suggested he put down that he earn 10 grand a year in order to be accepted. He didn’t take them up on it...

BrightYellowDaffodil · 02/08/2020 08:08

I would absolutely keep quiet about the childcare in your situation. After all, how many people get mortgages knowing full well they’re about to leave their job or whatever?

Go for it :)

RemyHadley · 02/08/2020 08:12

We did this and have remortgaged since with no problem. Nobody ever asked about the childcare costs that were by then visible on our bank statement. If they’d asked, we’d just have said that our plans for family childcare didn’t work out. It’s fine.

Allthebestusernameshavegone · 02/08/2020 08:18

I lied on mine op. I got a mortgage on Mat leave and told them I was going back on my normal salary. We purchased our house 4 months before I went back. Once the purchase went through, I put in my request to cut my hours.
A week after I went back to work I found out I was pregnant again, had another years Mat leave and cut my hours again and decided to put both children into childcare for a day a week (my mum looked after my eldest for a few months until my second Mat leave started).
Ive moved departments in work now and mine and my husbands pay has increased so our earnings now are more than when we originally applied for the mortgage.

Allthebestusernameshavegone · 02/08/2020 08:20

Just to add we remortgaged 6 months ago with the same company and they didn’t question anything about my first application.

Pillypocket666 · 02/08/2020 08:21

If you could afford the mortgage on you own you shouldn't need to lie as you have double that income?

Polly2345 · 02/08/2020 08:22

When we bought this house last year I’m pretty sure NatWest didn’t ask about childcare costs, which surprised me

A few years ago a mortgage advisor told me NatWest were the only mortgage provider who didn't take childcare costs into account. Not sure if that's still the case.

We've lied several times about all kinds of things when applying for a mortgage because it's been the only way to get a mortgage and we've been super confident we can afford it. If you have a good handle on your finances do it.

Bluegeode · 02/08/2020 08:23

I think that would be fine, a future plan about childcare can change, I don't see how you can be penalised for it

burntpinky · 02/08/2020 08:32

We were going to do same if we found a property in time. We didn’t fill in the standing order form for nursery. But we haven’t found the right house!

I think if you can afford everything on 1 wage (we worked out we could afford even our max mortgage plus childcare etc on 1 wage) in case 1 lost job it’s fine. It’s just the banks are super cautious with percentages of income.

Seracursoren · 02/08/2020 08:33

I would do this too. You know you can afford it as you have done your calculations.

Teacher12345 · 02/08/2020 08:34

I would do it. When we wanted to take 10k out the mortgage and extened it we were told we couldn't afford to, even though it meant we would be paying £50 LESS than we were. The whole thing is ridiculous and no common sense is used whatsoever when deciding if you can afford the mortgage. So carry on!

Junglerum · 02/08/2020 08:35

Ex mortgage advisor. Everyone does this everyone who I saw who was pregnant said they were going back full time after Mat leave and would have no childcare costs. Just make sure you can afford any potential change in circumstances and interest rates

Aquicknamechange2019 · 02/08/2020 08:38

@Canyousewcushions

You may well end up issues with affordability when you come to remortgage, and have childcare showing up in your financial information.

It's worth checking you will be OK on their SVR (Plus a bit for continfency) in case you end up stuck on it until you finish paying for child care.

I think it's fine to answer on the basis you have no childcare costs as currently you don't, but the advice above is spot on.

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