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Original poster

Impact of children on mortgage

43 replies

GulliverUnravels · 13/09/2018 18:16

DH and I are planning to start TTC in the next month or so. We're also wanting to buy a house in the next year or so once we've topped up our savings. It'll be the first time that either of us has a child or buys a house, and we wondered whether having a baby will affect our chances of getting a mortgage. We're so early on in the process we haven't even spoken to a mortgage advisor yet, but if it was going to negatively affect getting a mortgage we would consider delaying TTC until after we've sealed the deal on the house.
Any advice is welcome :)
(FWIW we're both 30, in full time employment.)

OP posts:

Spice04 · 14/09/2018 15:41

Like a PP I was pregnant when we sold our house and applied for a new mortgage. All was done over the telephone and email with the broker so pregnancy not disclosed. We had carefully considered our finances and what would be affordable on my reduced wage when I went back part time so we put an offer in on a property that was well within budget and mortgage easily approved. I think it's important for your own piece of mind that you dont overstretch yourself at this early stage before any baby(ies) come along. Particularly as many are indicating that mortgage rates are only going to slowly start to rise. We've recently remortaged with the same broker we first used and had to admit that baby was born before we actually completed on the property 2 years ago! Hahaha!

glintandglide · 14/09/2018 15:53

No Of course not OP. Once you have your house they’ll leave you alone provided you keep paying them! Home owners have children every day they don’t need to tell their mortgage company about them :)

namechangedtoday15 · 14/09/2018 16:59

@ianbeale thinking about TTC is completely to being pregnant in these circumstances, and it's a bit silly to suggest otherwise. Unless something goes terribly wrong, which is very rare, its fact that your income will change imminently once you're pregnant.

The question is asked to cover various eventualities - changing jobs, redundancy, pregnancy.

numptynuts · 14/09/2018 17:13

They don't ask if you are pregnant not outright but most mortgage applications will ask whether you know of any circumstances which will affect your income - answering no to this when you're pregnant is not being truthful (previous job looked at borrowers in default and whether lender would allow extra time to get out of arrears etc - any hint of dishonesty and they'd be less than accommodating)

As it's mortgage fraud.

WingingWonder · 14/09/2018 17:19

My childcare is over 1500 months nett, you need to factor that (or whatever sum will be relevant to you) in regardless of how pregnant or not you are
Also realise earning potential will reduce short term at least...

BergamotMouse · 14/09/2018 17:50

Just to add my experience.

I was on maternity leave when we applied for a mortgage for our current house. I had a letter from my work to say what % I was returning on and they just based it on that. I compared it against what banks would lend if we had no dependents and it was the same for us even though I had already had DD. They can't discriminate against you just because you are on maternity leave.

Since we currently had no childcare costs they didn't deduct any from our affordability. I mentioned that my parents would be providing childcare which was good enough for them even though i fully intended on putting DD into nursery 2.5 days a week.

We knew we could afford the repayments even with nursery costs.

I'm fully aware that if I had already returned to work and the childcare payments were evident on statements then they wouldn't have leant us as much.

Kescilly · 14/09/2018 17:56

This might be a silly question (and I hope GulliverUnravels doesn’t mind) but does it work the same way when you remortgage? We don’t have a child but potentially could when our fixed rate is up. Do they do a new set of affordability checks each time?

EssentialHummus · 14/09/2018 18:35

does it work the same way when you remortgage? We don’t have a child but potentially could when our fixed rate is up. Do they do a new set of affordability checks each time?

It depends I think. My lender (a building society) just sends me a list of new rates/options available and tells me to let them know if I want to switch to one of them as soon as my current fixed term is up (rather than revert to their standard variable rate). But if I wanted to move to a new lender I expect they'd do a set of affordability checks.

namechangedtoday15 · 14/09/2018 20:17

I agree with Essential - last time we remortgaged (with the same lender) we didn't have to send any papers or formally apply, it was just a question of switching to a different rate.

If you go with a different lender then they'll go through the same checks as your lender did when you first applied- but don't forget the price of your house may have gone up and you'll have paid off a chunk of your mortgage so chances are you'll be asking to borrow a lower % of the value of your house.

ianbealesonwheels · 14/09/2018 20:29

But they are planning on ttc in the next month or so. Not considering it in the future. So if asked a question if they are aware of any changes in circumstances i don’t see how omitting that information is any different to omitting pregnancy information. Either way the lender can’t ask until the baby is born

glintandglide · 14/09/2018 20:31

Mortgage fraud is a material misrepresentation or omission to your application. Such questions are asked in person, not on the application form. Certainly, not telling the mortgage company you’re pregnant is in no way a material misrepresentation. Sleep easy mumsnetters

ianbealesonwheels · 14/09/2018 20:33

If challenged if you fell into mortgage arrears you could presumably say you were unaware of the pregnancy. Can’t inagine banks can demand your medical records

glintandglide · 14/09/2018 20:39

You wouldn’t even be challenged if you fall into arrears. They will literally never use this information again, unless you have lied about something materially to increase the loan ie made up an employment, used a false identity, lied about a debt

glintandglide · 14/09/2018 20:41

Although anecdotally I have a friend who lied about having more than 1 mortgage and when she had to remortgage the simply told her “we see you have a potential
Undeclared buy to let, you’ll need a BTl mortgage this time”

Kescilly · 14/09/2018 21:08

Thanks EssentialHummus!

That’s a good point, @namechangedtoday15, but I think we are already at the lowest LTV rate. So I’m not sure we’d benefit. Plus, who knows what Brexit will do to the value of our house!

Original poster

GulliverUnravels · 16/09/2018 08:15

Plus, who knows what Brexit will do to the value of our house!

Yes, this is another consideration... it's possibly worth (for us as buyers) waiting a bit longer to see if prices fall. But that potentially means delaying TTC even longer, and I don't want to leave it too late! It's so difficult!

OP posts:

glintandglide · 16/09/2018 08:23

Your mind seems pretty made up OP, even though I can’t see much evidence given on this thread that you need to worry, certainly to the extend of delaying TTC seemed like you’d already made your mind up

MaverickSnoopy · 16/09/2018 08:39

We have been through this twice. I was pregnant when we bought out first house, but very early days. No one asked and we didn't disclose. Moved into house when I was about 4 months pregnant. Then bought next house when I was pregnant again. They asked if we had children and we said one and the mortgage advisor said she would factor it in. In the end she found a mortgage company who didn't include childcare costs - so there are some out there. We didn't however disclose my second pregnancy. We moved into the house when I was about 5 months pregnant. From memory we had the mortgage offer when I was 2 months pregnant.

So now we're living in the house we moved into during the second pregnancy and we're on a 5 year fixed term and I'm pregnant again. In that time I've also given up my well paying job and have a smaller part time job, although am now on maternity leave. Mortgage is paid on time every month as are all bills etc. Mortgage company don't know about our change in circumstances. Circumstances change sometimes and for us it's why we decided to fix in for 5 years (to buy us time while childcare and babies were unpredictable/young). As it stands I plan to become self employed after mat leave (steps already in motion) which will give me back the same disposable as when I was working full time (but not the same salary). This will allow us to save more/over pay on mortgage/pay increased interest on mortgage. Our mortgage provider will let us fix into another rate with them without going through all of the checks again. The big question mark is what the rate will be. I think that if we needed to go through the checks again we might just scrape through but it's a bit of an unknown entity at this stage.

I have planned everything from the beginning to allow me to work part time and I'm hoping it all works out. You could see a mortgage advisor and ask if there are suitable mortgage companies who don't include childcare costs. There is no harm in asking. Certainly though I would want to be moving in before baby is born, personally I just wanted to get everything ready and be settled.

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