How does a dependent affect your mortgage application?

Xios

I'm going to be applying for a mortgage in a few months and the wife is pregnant.

Should we hide this fact from the bank during the application process, as it may affect our application or does that not matter much nowadays? A quick Googling only showed articles from 2013.

She's working in a government job, so pay continuation won't be too much of an issue.

dennyk

It would definitely affect the maximum amount you'd be able to borrow, though if you are being frugal, shopping under your means, and not looking to max out your allowable loan amount (which you probably ought to be doing anyway, keeping in mind the added expenses of a new kid yourself), it might not hurt you much in the end. Whether the possible loss of income if she were to choose not to return to work after her leave is up would make some lenders wary probably depends on your overall financial situation.

As for telling the bank, your kid isn't technically a dependent until they are born, so it really depends on your schedule and when the baby is due. I wouldn't advise committing fraud by failing to disclose a dependent who actually does exist, if it comes to that.

pwurple

The wife, a wife, your wife?

It affects your disposable income calculation by 500 per month, per child. How tight are you there on those numbers? Is it a twin or single pregnancy...

Hoboo

Do you have any dependents? No.

That's the only answer until you have a dependent.

Simples.

mickoneill31

Xios wrote: »

I'm going to be applying for a mortgage in a few months and the wife is pregnant.

Should we hide this fact from the bank during the application process, as it may affect our application or does that not matter much nowadays? A quick Googling only showed articles from 2013.

She's working in a government job, so pay continuation won't be too much of an issue.

When I was switching mortgage to ulster bank the advisor was coming to our house to get documents signed. My wife was obviously pregnant so I said it to him. He replied that at this moment in time we had no kids so he would treat the application as such.

I know you would argue that an unborn baby is still a baby but I wasn't getting into that discussion as it would have affected our mortgage and I was happy for him to leave the number of dependants as 0 on the application

But apply quick before you have the baby. It can take about 3 months from start to finish.

So if the baby is due in less than 3 months you'll have it before the mortgage and it could affect the amount you get. If the baby is due in more than 4 months you have time to get the mortgage first. 3 months is a worst case scenario. Our mortgage took 3 months. Some can be done in a month.

lucast2007us

It affects definitely depending on the bank how much as well though. We were offered 180,000 originally by BOI but after going through everything and mentioning a dependent we were offered 140,000.

AIB however still offering close to the 180,000 they have said they will now do 172,500.

Peregrinus

mickoneill31 wrote: »

But apply quick before you have the baby. It can take about 3 months from start to finish.

It takes about nine months. I though everybody knew that.

Then you spend the next 25 years or so dealing with the consequences. (Quite a lot like a mortgage, come to think of it.)

Trish56

If you're applying before the baby is born the answer on the application for dependents would be 0. If you're applying after the baby is born the lenders will add €250 to the monthly net disposable income requirement (€2300 for a couple with 1 dep) however they will also ask how much childcare you pay monthly and this is the what will have the biggest effect on how much you can borrow as it is treated like a loan.

All lenders will process and issue your mortgage once you provide a letter from your employer stating expected date of return from maternity leave.

Xios

Thank you all for the advice, I'll get the application in early next year, hopefully we can get the keys for the home before the baby arrives

Sunrise_Sunset

I believe that when the banks are stress testing they will add in 250 per dependant. But at the moment you have no dependants.