Brokers have hit out at lenders’ treatment of applicants on maternity pay when assessing mortgage affordability.
Mortgage advisers say lenders including Santander, Nationwide and Northern Rock will not take into account that a borrower’s salary will return to normal after maternity leave ends, unless the borrower gets proof from their employer of their intention to return to work.
Nationwide also factors childcare costs into affordability assessments.
Brokers say it is unfair lenders do not make these policies clear before borrowers apply for a loan.
Email Mortgages chief executive Michael White says: “When someone is on statutory maternity leave, for affordability they will only calculate the monies being paid to that person during that period. Very quickly, you are on something like £100 a week, when your normal salary might be more like £30,000. I think it is a very unreasonable approach.”
Emba group sales and marketing director Mike Fitzgerald says: “The lenders would do everybody a favour if they had clear guidance on how they treat people on maternity benefit.”
A Santander spokesman says the firm asks pregnant borrowers how they intend to maintain the mortgage. He says: “If they demonstrate a sensible answer, we will accept.”
Nationwide and Northern Rock say their policies are a fair way of ensuring that applicants are borrowing at a level they can afford.