What are the odds of me being able to get around this?

[TensionWheelsCoolHeels]

My situation is I have a mortgaged flat which is in need of a lot of (mainly superficial) work which I cannot afford to do, due to limited income & restrictive circumstances. I want to move, to free myself up in terms of increasing my work hours & saving on childcare costs (as my mum can help where I move to). The difference in my financial circumstances would be huge as it would bring me an extra £650 per month net earnings as a minimum, with potentially more with bonus/overtime etc.

The problem I have is that in order to get from where I am now (part time, lone parent paying for child care & any increase in hours/wage is wiped out by reduction in tax credits) to where I want to be, is that my current situation is deemed unaffordable from the POV of my mortgage lender as this is based on my current income/expenditure etc. If I can move, my situation improves enormously but I'm not in a position financially to be able to get another mortgage due to the change in lending criteria.

I spoke to my mortgage provider earlier to see if my mortgage would be portable, but the upshot is that while it is, the affordability criteria currently means I would not be granted a new mortgage. I realise that may be different elsewhere but what I'm trying to avoid is any actual mortgage rejections as my credit rating isn't too healthy as it is.

The person I spoke to understood what I was trying to do, and said that if I can provide evidence from my employer that I would be guaranteed an increase in my hours/salary, they could ask their underwriters to consider this. I was also told that the not needing childcare will be harder to prove, as even a letter from my mum confirming she would be my childcare wouldn't be enough for them as proof I no longer have childcare cost to pay out. I'm not actually sure how else I can prove this if a letter from my mum isn't enough evidence.

Even if I can get the letter from my employer & somehow they did accept my mums letter too, is this likely to get me the green light for a mortgage on a new home that I want? The costing if I move works out about the same as I have now, after all deductions/costs, I'd have either the same or a mortgage of about £5k more than I have now, more than affordable for me to take on.

For a complete picture, I have had a mortgage now for 18 years, never missed a payment of paid late, but I do have debt & an issue with an old mobile a/c from 3 years ago which is listed as a default (cleared now, it was £30 and unfortunately I doubt my protests of having been screwed by the mob co won't gain me any sympathy).

So, does anyone who deals with mortgage applications know if I'm wasting my time even trying this, or if I obtained the information they've said they'd consider, is it a persuasive argument I'm likely to succeed with?

Thanks.

sorry OP but based on the few facts you've given the odds are slim to none.

Without specific facts it's impossible to do more than speculate but having only one income, debts and 'an issue with an old mobile' means lenders are going to be very cautious.

It will all hinge on what you actually earn, what deposit you have and how much your debts are.

I very much doubt your employers will document an increase in hours/ salary unless it's going to be contractual otherwise you could enforce it with them.

Have you considered selling up, renting, clearing the decks then applying for a mortgage?

Thanks. I have equity in my current property & that would give me approximately £30k deposit after costs/debts cleared. My concern with selling, clearing debt & then trying to buy later on is that ill end up not getting a mortgage again because of their affordability criteria. My debt isn't huge but I can't clear it for a long time as things stand because my income is effectively capped while I still need to pay for childcare.

I understand the need for caution but I think what I'm trying to find out is if I give an in depth explanation of my situation will that be heeded & taken into account or if id be wasting my time even trying. I'm taking what you've said as it being the latter.

In terms of my job & increased hours, that's a catch 22 situation because I can't increase my hours in the situation Im in because it increases my childcare costs & cancels out tax credits which go towards childcare so I gain very little from increasing my income due to increased cost & decreased tax credits. So I cant change my contract (and increase my income) until I move & have the childcare in place to make that change possible but I'm stuck/can't move because my current situation is deemed unaffordable according to the current lending criteria. The frustrating thing is I can & have been able to afford my (current) mortgage & it wouldn't increase (might even reduce) if I can move, but I can't get my mortgage renewed because if the new lending criteria. And round & round I go with trying to figure out what to do.

I'm stuck really.

The problem is the MMR rules that came in earlier in the year are all about affordability and all a lender can base a decision on is what your current situation is and has recently been, not what it might be.

You'd be better chatting with a broker about your specific situation but don't get your hopes up

It sounds like you would stand a far better chance of getting a mortgage if you moved, rented, cleared your debts and could demonstrate that you had no childcare costs and higher income for a few months.

I agree it's a risk but that or staying where you are seem your only options.

Thanks. I think I knew that was the answer - i think it's just frustrating knowing that the new criteria deems my situation as unaffordable on the mortgage I have now & am paying (so it is affordable for me and that's evident from the fact I've never had a problem paying, and won't have a problem paying IYSWIM). The new criteria seems at odds with the fact I am & can pay my mortgage.

Is there any mileage in converting your current mortgage into a BTL and renting your flat out? You could then move into a rental and achieve all your other criteria which sounds like it would enable you to save up and improve your overall prospects. You could then revisit the residential picture further down the line. Clutching at straws but everyone else seems to suggest you're on a hiding to nothing in the residential market. Mortgagees are more interested in rentability when lending for BTL.

the new criteria seems at odds with the fact I am & can pay my mortgage.

The fact that you have debts that you can't clear for 'a long time' indicates to the lenders that you can't comfortably afford your mortgage and the lenders would be deemed irresponsible if the lend to you.