is this discrimination? if so, what can I do about it?! **long, sorry**

[Thorsmum]

I recently separated from my husband and have accepted an offer on the marital home.

I approached my bank and was told I would be able to get a small mortgage through them on my own and was given a decision in principle stating I could borrow up to £89,000.

The following day I found the house I want, made an offer which was accepted and contacted my bank to make the mortgage application. I had to make an appointment to see a mortgage advisor later that week who took detailed information about my income and expenditure and drew up a recommendation which stated that the mortgage was 'affordable'.

I had to wait 2 weeks for a follow up appointment to proceed with the application which I attended on Saturday and was advised that it had all gone through and just needed the branch managers signature which I was assured would just be a formality.

On Tuesday I received a phone call advising me that the branch manager has refused to sign off my application as the mortgage is unaffordable! I questioned why and was told that my total outgoings exceed my income by £232 per month I assured them this was not the case and they can see from my bank statements I am able to put money into savings every month after paying the much larger mortgage on my current home. It became apparent from the discussion that followed that they had taken into account all of my outgoings relating to my son including the lovely £260 per month childcare costs but they are refusing to take into account the income I receive in the form of maintenance payments, child benefit or child tax credits (totaling almost £900 per month!) As this is not guaranteed for the term of the mortgage (30 years). I pointed out that I don't expect to be paying childcare for my then 32 year old son but they will not budge on their decision.

I feel that their decision to decline my application on this basis is descriminatory as if I didn't have childcare costs my application would have been successful and their decision to disregard the significant additional income is at the very least unfair.

I am now seeking a mortgage elsewhere but I don't want to walk away from this quietly, I have lodged a complaint with the bank and advised that I will take this to my MP and the media as I feel it is a discuting abuse of the new regulations that came into force at the weekend following the mortgage market review which will result in people like myself being forced into ironically more expensive rental properties which don't offer the longterm security I am seeking to provide for my son. Other than following up on my complaint what can I do?!

I heard on radio someone advising to wait for couple months as the MMR just came into force and as they get used to it the banks may become more reasonable...

I don't see how it is discrimination as spending is spending

Fair enough, but if I was paying for child care through a voucher scheme my childcare costs would be reduced by the amount of tax and ni I would be saving. As I qualify for tax credits I am better off claiming them but the bank wont accept tax credits as income. This seems somewhat unpalatable.

If you are recently separated, I know my mortgage broker said most (not all) mortgage companies want to see consistency with maintenance payments over at least a 6 -12 month period so that could explain why they won't look at maintenance. I also know that Tax Credits aren't always considered 'income'.

You raise an interesting point because it is single parents who will be seriously affected by this - the majority of which will be women trying to house children following relationship breakdown with often limited income but large deposits from divorce settlements. Astffordability is all very well but ultimately, few people's lives remain the same over a 5 year period let alone 25 years so there needs to be some reasonable flexibility in calculations. Gingerbread are the campaigning organisation on single parent issues - might be worth raising it with them?

It's something I was looking into the other night - I've been paying my mortgage almost 18 years, never defaulted, and the current mortgage I pay faithfully every month is apparently unaffordable to me with the very establishment that I have my current mortgage with. It's a worry because I have been aiming to sell my property next year and the changes (especially taking childcare into account) could well screw up any plans I have. If I can move, I won't have anymore childcare as my mum would be around for DD, I'd also be able to increase my hours with no loss to childcare costs, but to get to that much better financial position, I may not get the mortgage I need.

I share your concerns OP. It certainly feels unfair and discriminatory.

Try Santander and Halifax, they will consider tax credits and child maintenance as income.
Or even better, make an appointment with an independant mortgage advisor, they can really find the best deal for you abd it's free as they work on commision.

I had to show a court order to prove my maintenance but it was taken into account as was WTC. I don't know how they can say that it's not guaranteed when no job is either for that length of time. I would maybe try someone else. Have you got an independent broker who may know of other lenders?

I now have an application in progress with another provider who are happy to take all my income into consideration and I am hopeful that this will be successful but I feel at the very least the original provider needs to review it's processes so that it doesn't take 4 weeks to decline an application on the grounds of affordability!

I do feel that I have been unfairly treated. I get on well with my ex and could ask him to pay the childcare provider directly and reduce the amount of maintenance I receive. In theory this would make the mortgage affordable but in reality would make it much tougher for me as I wouldn't be able to claim the child tax credits that I currently receive!

fedupbutfine articulated my views beautifully. This really will impact single parents who are mostly women. This is an absolute definition of indirect discrimination. But who will fight it?

I do understand that a mortgage needs to be paid but many of us will have capital and low to little income. I tried to remortgage for funds last year and was told that the mortgage company (been with for decades, never arrears) would only look at income not LTV.

I used to be a bank manager and unfortunately they are able to set their own guidelines with what they will allow as income. The way this has been handled is appalling and affordability is usually the first hurdle. The fact they have taken so long to decline is a massive failing on their part. My advice to you would be to select your next lender very carefully as every application you make beyond an agreement in principal will affect your credit score massively and could jeopardize your chances of getting a mortgage at all. I would try Halifax as their multiples are higher for a start, not sure about whats accepted as income etc. Failing that go to a no fee broker. You would only pay anything to them if they secured a mortgage for you. Good luck

Is it fair to assume the childcare costs are yours alone anyway?
No idea on the legalities of it but fuming for you OP!

did lol at "I don't expect to be paying childcare for my then 32 year old son" :o

This has been on my 'things to rant about on mumsnet' list for the last week.

My mortgage provider (for 10yrs!) refused my application to port my mortgage to a new property, for the same value. I've paid without fail for 10yrs, overpaid for some of it, no loans, pay life assurane, mortgage protection, always employed, perfect credit scoring etc. But they turned it down . Luckily I have sourced another mortgage provider through my mums financial advisor who should accept me (although house move has fallen through for now ). But yes, think single parents are going to be shafted my the new rules.

Someone on the TV said single income families would find it harder to get a mortgage, that's every single parent family then!

....And they would only accept my mortgage to run for the maintenance and child tax credits term, ie; another 13yrs when DD is 18. They wouldn't accept I'd be able to maximise my hours and work full time when they dc's were off to uni. So any losses in maintenance would be offset by my increased earnings.

It was a fucking painful phone call. .

Idiots

actually, are your exes having similar problems?
If not, then surely that strengthens the case for indirect discrimination.
If they don't accept that maintenance comes in to your bank account, do they also fail to see it going out of his? Therefore assuming he has more money than he actually does?

I am considering remortgaging at the moment and haven't worked since pg with DD. I am dreading all of this as exp pays the minimum CSA maintenance. Somehow he has also managed to live in London for the last 2.5 years and has a mortgage on a new house, so no, it doesn't seem to affect them. In fact if they could tell the CSA how much he is paying them my DD would surely benefit as a result, hence why it is all so hush hush. It should work both ways and banks should be under obligation to inform CSA.

If they don't accept that maintenance comes in to your bank account, do they also fail to see it going out of his? Therefore assuming he has more money than he actually does?

this is a good point and one, I suspect, where 'discrimination' would most certainly raise it's ugly head. I have cast a glance over the new 'affordability' rules and I suspect that if they are very strictly adhered to, there will be far,far fewer mortgage approvals than there have ever been (single income or no single income). What this will mean for the housing market, the banking industry and who knows what else economically in the UK is beyond my understanding. I presume this is the plan...and it is single parents who are seriousl going to struggle as a result.

singe resident parents

stealth I think my ex rents, we don't have anything to do with him.

All those 2 parent families could split up tomorrow, and the stats say a third of them will. At least I can prove XP has paid maintenance for 5yrs without fail, that's better than most.

I was wondering if Gingerbread were keeping an eye on it. Will be interesting to see if it becomes a problem.

They take into account maintenance paid out as its classed as a priority payment like council tax

Oh that's something. But the person iit's paid to can't use it as income when getting a mortgage

stealth I should be able to when I apply again. My broker said court ordered maintenance counts.

In fact, now the Tories are trying to force parents into private maintenance agreements then all of them will be screwed . At least I've got the CSA on my side and the paperwork to prove it.

Thanks for all the replies. I'm so angry to see I'm not the only person who has been affected by this. I have raised a formal complaint with the original lender and will be taking it as far as I can.

Even if they are able to justify their actions by hiding behind their policies, I will question the legality of those policies and attempt to bring some common sense back into their decisions.

Just to add insult to injury, I received a letter from the original provider yesterday advising they have written to my gp for more information about my medical history in order to provide a quote for a mortgage protection policy which I applied for at the same time as the mortgage!!