100% of income from child maintenance to be taken into account

 

Tuesday, February 2, 2016

The Ipswich Building Society has just announced that all of its residential mortgages will be available to divorcees with 100% of the income from child maintenance taken into account when assessing affordability, provided it is supported by the Child Support Agency or Court order which has at least five years left to run.

Often divorcees will have considerable difficulty in trying to find a lender who will provide them with a mortgage even in circumstances where they have demonstrated their ability to pay an existing mortgage.

The government seems keen at present on ensuring that people make agreements directly with each other in respect of child maintenance.  However, lenders usually require evidence by order or at the very least a solicitor’s letter.  It is essential that you ensure your child maintenance is paid directly to your account by standing order.  The lender will need to see this as evidence of an agreement.  Also consider paying the child maintenance agency £20 to formally assess and approve the agreement in writing if it is not part of your consent order.

Kerry Rowell comments “being able to raise a mortgage either to purchase a new property or to release an ex-spouse from their obligations under a mortgage is often key to achieving finality in a divorce or separation.”

Below is a list of lenders showing the extent to which each will consider the child support you receive, arrange for a recommended IFA to consider them with you:-


Takes Child Support into Account (With CSA/Court Order)

Cambridge Building Society – may make an exception to the above where there is a proven track record.

Clydesdale and Yorkshire Banks – looks at borrowers on a case by case basis.

Co-operative Bank – takes 100% of maintenance into account but wants to know this is sustainable.

Metro Bank

Virgin Money –Will take it into account if the assessment or order has been in place for 2 years.

NatWest/RBS – doesn’t always insist but will look for sustainability.


Takes Child Support into Account (Without Court/CSA Order)

Santander – Will require evidence of payment for at least 3 months i.e standing order
Tesco Bank – As above

Barclays – If no court order then Barclays will consider you if child support has been paid continuously for 12 months.

Source ‘This is Money’