Mortgage rate ending while on Mat leave, help!

[MetalRat]

Ok so our (me and DH) fixed rate is up in Feb, and we want to move house at the same time. I’m currently on Mat leave with our second DC so our combined income is not what it was. I know it’s the worst time to be buying and selling but we need to move soon to get into a better area for schools for DC1.

My understanding is that a product transfer (new rate with same lender) would mean no financial checks. Is it possible to do a product transfer but onto a new property? Or would that trigger all the payslips/affordability checks etc. We would be looking to keep the same amount, ie not borrow any more, for the move.

Our current mortgage is portable, but I’m not sure if you can both transfer and port at the same time if that makes sense. I just want to avoid getting reassessed with our lower income + higher outgoings (additional childcare fees). We can just about afford the extra costs as we have savings to cover our costs during my Mat leave, and I will be going back to work soon after but unlikely full time. DH will be due a raise by the end of the year but it wouldn’t cover what my salary was previously.

We’re going to speak to our broker soon but thought would ask for some thoughts here first 😊

No advice but am in a similar position so following with interest!

I have just ported my mortgage in the middle of a fixed rate period with no additional borrowing. The mortgage company still re-assessed the affordability element and I had to provide payslips/ bank statements etc.

I'm guessing that you are unlikely to manage to time your move to the exact time that your mortgage deal finishes, so you may well need to move onto a new product in your current property and then port that mortgage over. Or move first, porting your current deal and then get a new product. I would have thought if the timing is close then you may be able to do it all in one.

You will be 100% reassessed. We were. They denied us the mortgage porting and moving.

Will you need to borrow additional money or will your current mortgage amount cover what you need for a new house?

Usually you can secure your new mortgage deal 60 days before the actual end date, so is that December for you or have you included that already?

Also for affordability they should take you salary into account not your maternity income - I believe - but check with your specific lender.

Overall it would be better to renew and then port to a new property, give no real way of planning exactly when that part would need to happen.

@ithappened thank you, super useful. Yes the timing of it is very tricky

@ladyvivienne ouch sorry to hear! Can I ask what you ended up doing?

@Overthebow yes we think we can afford the new house with the current amount plus equity from the current house sale 🤞

@YoBeaches ok good to know that pref order is renew then port, makes sense .. and yes technically they aren’t supposed to assess with maternity wage but I’ve been hearing lenders are getting extra tight on affordability, they would def frown on the chunk that goes out to childcare 😭

You will be moving house! Of course they will take you through a full fledged mortgage application. We ported when we moved house and it was a proper full fledged application with the bank doing a survey on the new property it was mortgaging and all the trimmings.

They will add a second child to the affordability dependants under 18 algorithm. They will take into account the new set of childcare costs. They will apply the new cost of living algorithm.

it’s not going to be like - hiya we will do a product transfer with you but oh by the way we are just also moving house!

Hi I’m a mortgage broker. The banks will do a full underwrite when you move, whether you want to borrow more, less, or the same.
the amount you can borrow will depend on your plans once you mat leave ends. Lenders aren’t able to to penalise you for having a baby so generally they will take into account the salary you will be on when you return to work, they may ask for a letter from your employer confirming your return date and salary.
PP is correct in saying that your child care costs will be taken as a commitment, but if they are not showing on your bank statement at the time of application you can provide an indicative figure.
Depending on the lender you can usually arrange a product transfer 3-6 months in advance of the product expiring.
I am advising my clients to fix a new rate as soon as they can to secure it, and then if rates decrease between the time it is secured and the expiry date of the product it is easy to switch to the cheaper product.
so to confirm, there will be no underwriting for a product transfer but when you come to
move and port it then it will be treated as a new application.

Weren't able to port even though I had come back off Mat leave and was earning well it's not an automatic right I'm afraid

We bought our first house whilst I was on maternity leave. They take your salary into account as you will be returning to work - not your mat pay. That was actually why we bought at that time, so that if I decided to go part time after, a drop in wages wouldn't matter as we already bought the house based on my wages previous to mat leave