Mortgages post Covid, annual Bonus as major part of income

[PopsandBangs]

Quick one for those in the know

How are things currently, or shaping up to be, with regards to lending based on income where a large proportion is an annual commission-based bonus (I am an account manger.)

The Bonus I receive has been largely consistent (gradually increasing year on year,) and is due to be again slightly higher this financial year, after my company's year end last month, due to be paid this August. The company is in rude health, and in fact Covid has bolstered/increased it due to the nature of what I sell

This bonus represents approximately another 30-40% of my annual pay.

I have seen that a number of high street lenders have discounted such income as eligible for lending calculations which would seriously scupper me.

Are there still viable and sensible products on the market that would cater to me, in say 5-6 months time?

[Sarnie]

Most lenders are not accepting any variable income......a couple are............naturally no one can say what will be available in 5-6 months............

[CharlesElliott]

Consistency is generally the key - average of two or three years and trending upwards helps. Staying in the same role/job also helps as that indicates that things are more like to continue as is.

Sarnie on here seems to be the go to person.

[CharlesElliott]

Sarnie knows better than me and has posted in the meantime!

If your mortgage is large then I can recommend some brokers who have options outside the high street at reasonable rates.

[PopsandBangs]

Thanks kindly both.

As I suspected fingers crossed for an "improvement" in criteria then later in the year.

[kiethton]

In the same boat here and watching with interest given today’s announcement may accelerate our plans

[anonymous-user]

Just remortgaged, HSBC / NatWest both stated annual salary only.

[devnull]

I’m on a 60/40 plan + car allowance (which is just cash to me...). My advisor worked on my base salary alone for my application, which was totally fine for me. No way you could assume your compensation is going to be there year after year - look at what’s happening this year. I predict to be down 5 figures this year in terms of pay, yet it ‘doesn’t matter’ because I budget purely off my base.

[lampchair]

Halifax dropped from considering 60% to 30% of bonus / commission / OT in the last few days

[PopsandBangs]

devnull said:

I’m on a 60/40 plan + car allowance (which is just cash to me...). My advisor worked on my base salary alone for my application, which was totally fine for me. No way you could assume your compensation is going to be there year after year - look at what’s happening this year. I predict to be down 5 figures this year in terms of pay, yet it ‘doesn’t matter’ because I budget purely off my base.

The issue I have is that, especially buying with my partner as is the plan, a mortgage would be perfectly and more than comfortably serviceable from monthly basic pay.

But, the additional annual bonus (which is as reliable as remaining employed at the same place, i.e as reliable as the monthly basic pay which they'd consider lending off,) would mean, after applying a multiplier, the difference between a nice house or a mediocre one/flat.

Ah well, we'll see how things stand in a few months