Banks require consistent income for set timeframes when approving a mortgage as this indicates job security and a clear ability to repay the home loan. When there are inconsistencies or multiple sources of income, issues and questions can arise. If these are not dealt with in the right way it can often lead to a declined mortgage application.
The clients in this case study were a married couple who just had their first child. Both were expatriates that had been living in Dubai for several years and working for a reputable aviation company. This property purchase was their first in the UAE; they owned property in their home country. The clients were planning to buy a villa in Arabian Ranches to give them more space for their newest family member.
The problem
We had been recommended to the clients by their friend who had used our services previously. The clients had attempted to secure a mortgage themselves before contacting us – they had applied directly to a well known bank, however, their case had been declined which led them to approach us.
The clients were facing two hurdles in securing a mortgage. The first was due to multiple sources of income. The second was inconsistencies in income within the last 6 months, which caused issues in meeting affordability criteria.
Following the birth of their child, one of the clients had taken three months maternity leave and had just recently returned to work. During the three-month maternity leave, the client was only paid her basic salary, but when working normally the client was entitled to her basic salary plus an additional sum for the unusual and long hours she worked. However, as she had not received this pay consistently for six months prior to the mortgage application, several banks would not take it into consideration as their affordability criteria meant they were required to look at average pay over a six-month period. Furthermore, some banks would only take into account her basic salary and not the additional income which she received every month, even though this was a regular income which could be evidenced in her bank statements.
Our solution
We used our in-depth knowledge and experience of the various banks’ policies and criteria to consult with the ones that we knew would be most likely to consider this application. We took the time to explain the case to our contacts at the banks and found a lender which would consider the clients’ additional income, as well as take into account the average of just three months income for the affordability checks, rather than six, given the clients’ circumstances.
The result
We managed the full mortgage journey for clients and worked closely with the other parties throughout the buying process. The clients were able to complete the purchase smoothly and stress-free. They bought a three-bedroom villa in Arabian Ranches within a short space of time after their first conversation with us.
Case study by Charlotte Stanley, Senior Mortgage Consultant
