Yes, it may be possible to get a mortgage while you are on maternity, paternity, adoption or shared parental leave.
The lender will not necessarily assess you only on the temporary income appearing on your current payslip. Some lenders may use your normal return-to-work salary where your intended return date, working hours and employment terms can be evidenced.
However, lenders do not all assess parental leave in the same way.
One may accept your full normal salary where you are returning on the same hours and terms. Another may use a reduced figure if you intend to work fewer days. A further lender may want an employer's letter, recent pre-leave payslips and details of expected childcare costs before deciding what income is sustainable.
The most important point is that the lender needs an honest picture of your finances after the leave period, not simply the highest salary shown before it began.
FG & Cook's specialist mortgage advisers can review the leave arrangements, return-to-work plans, income evidence and future household costs before identifying lenders whose criteria fit the circumstances.
Can you get a mortgage while on maternity or parental leave?
Potentially, yes.
Being on leave does not automatically mean that your normal employment income has ended. In many cases, the employment continues while the amount actually received changes temporarily.
The lender will usually want to understand your normal pre-leave income, the type and length of leave, the intended return date, whether you will return to the same role and whether your hours or salary will change. It will also consider any period of unpaid leave, expected childcare costs and whether the mortgage remains affordable both during and after the leave.
The decision is therefore not based simply on the words “maternity leave”. It is based on the expected long-term household position.
What income might the lender use?
There are several possible approaches.
A lender may use your normal pre-leave basic salary, your expected return-to-work salary, a reduced salary based on fewer hours, current maternity or parental-leave pay, or a combination of current and future income.
Another lender may use only the other applicant's income where the return arrangements are too uncertain.
This is why two applicants on similar leave can receive different outcomes. The key difference may be the intended working pattern after the leave ends.
What if you are returning on the same salary and hours?
This is often the simpler situation.
The lender may be prepared to use the normal salary where there is clear evidence that the employment remains in place, the role and basic salary are unchanged, the working hours will remain the same and the return date is reasonably clear.
Evidence might include pre-leave payslips, the employment contract, an employer's confirmation or a completed lender form.
The lender may still consider whether the household can meet mortgage payments while actual income is temporarily lower. For example, an applicant may normally earn £45,000 but receive only statutory pay for part of the leave. The lender could accept the future £45,000 salary yet still ask how the household will manage before normal pay resumes.
What if you plan to return on reduced hours?
The lender is likely to use the reduced future income rather than the old full-time salary.
Suppose an applicant earned £48,000 working five days a week but intends to return for three days. A simple pro-rata starting point might be:
£48,000 × 3 ÷ 5 = £28,800
The actual figure can vary if the employer changes the hourly rate, duties, allowances or contract terms.
A request for flexible working is not the same as an agreed reduction in hours. The lender may want written confirmation of the approved working pattern, return date and revised salary before relying on the new figure.
What income is received during maternity leave?
Statutory Maternity Pay can normally be paid for up to 39 weeks where the eligibility rules are met. The first six weeks are paid at 90% of average weekly earnings before tax, followed by 33 weeks at the statutory rate or 90% of average earnings, whichever is lower.
Some employers provide enhanced maternity or parental pay above the statutory minimum. Other applicants may receive Maternity Allowance rather than Statutory Maternity Pay, while Shared Parental Pay may be available where the relevant conditions are met.
These payments can help explain how the household will manage during leave, but they are not automatically treated as permanent annual income for the mortgage term. The lender's main focus is usually the sustainable position after the leave period.
Do childcare costs affect mortgage affordability?
Yes, and this is often one of the most important parts of the assessment.
A lender may accept the return-to-work salary but still reduce borrowing because of future nursery, childminder, breakfast-club, after-school or holiday-care costs.
For example, returning to work could increase monthly income by £2,000 but introduce childcare costs of £1,300. The lender will not assess the extra salary in isolation from the new expenditure.
Government support may reduce the amount ultimately paid, but the lender will normally want a realistic and evidenced figure rather than an optimistic estimate. A childcare entitlement should not be entered as guaranteed income or a guaranteed saving unless the lender accepts it and eligibility can be evidenced.
What if you have not decided when or whether to return?
This can make the application more difficult because the lender needs a credible future-income position.
Uncertainty may arise where the return date has not been chosen, the applicant may extend leave, flexible working has been requested but not approved, the applicant may return part time, childcare arrangements are unresolved or the household has not calculated the cost of returning.
In that situation, the lender may use the current lower income, exclude the applicant's income or wait for clearer evidence.
It is important not to state that you intend to return full time merely to improve affordability if that is not your genuine plan.
What evidence will the lender normally request?
Requirements vary, but the evidence pack may include pre-leave payslips, current leave payslips, bank statements, a P60, the employment contract, an employer's letter, the intended return date, confirmation of return-to-work salary or revised hours, details of enhanced pay, childcare-cost estimates and evidence of any accepted childcare support.
Some lenders use a specific parental-leave form.
The information must be consistent. If the application says the applicant will return full time in September but the employer's letter confirms a three-day week from January, the lender is likely to ask further questions.
How are bonuses, commission and overtime treated?
Usually more cautiously than basic salary because variable income may reduce or stop during parental leave.
The lender may consider how long the applicant has been on leave, whether the income was received before leave, whether it will resume after returning, whether it is guaranteed and whether reduced hours will affect it.
An applicant should not assume that a historic £15,000 bonus will be used if there is no evidence it will continue after a return on fewer hours.
What about KIT and SPLIT days?
Keeping-in-touch days and shared-parental-leave-in-touch days can allow limited work during leave without bringing the leave period to an end, subject to the employment rules.
For mortgage purposes, income from occasional KIT or SPLIT days is unlikely to prove a full return-to-work salary by itself. A lender may view it as supporting evidence that the employment relationship is continuing, but the normal return date, hours and salary will usually remain more important.
The treatment varies, so any such payments should be shown clearly rather than presented as ordinary recurring monthly income.
Can you apply before the baby is born?
Yes, but the lender must still be told about known or expected changes that could affect affordability.
Pregnancy does not itself prevent a mortgage application. However, if the applicant knows that income will soon reduce, leave will begin or childcare costs will arise, those facts may be relevant to the assessment.
The lender is not entitled to discriminate unlawfully because someone is pregnant or taking maternity leave. It is, however, entitled to assess sustainable income and expenditure.
Failing to disclose a foreseeable material change could affect the accuracy of the application.
What if your partner is taking the leave?
The same affordability principles can apply where the person taking leave is the father, partner or adopter rather than the mother.
Shared parental leave can divide leave and pay between eligible parents. The lender therefore needs to understand which applicant's income will reduce, for how long and what the eventual working arrangements will be.
Where both applicants plan to reduce hours, the combined effect can be significant.
What if you are self-employed?
Self-employed applicants do not usually have an employer confirming a return-to-work salary.
The lender may instead assess historic accounts, tax calculations, tax-year overviews, current business performance, management accounts, business bank statements, contracts or future work, the length of the trading interruption and whether somebody else maintained the business.
A temporary reduction in trading because of maternity or parental leave does not automatically make the business unsustainable. However, the lender may need evidence explaining why recent income fell and whether the business has resumed or is expected to resume at a realistic level.
Applicants in this position may also find our guide to mortgages with one year's self-employed accounts useful.
What if your plans change during the mortgage application?
Tell the broker and lender promptly.
Relevant changes include extending the leave, returning later than planned, reducing hours, changing employer, resigning, moving into self-employment, a change in salary, higher-than-expected childcare costs or the other applicant losing income.
A mortgage offer is based on the circumstances disclosed during the application. A material change before completion may require reassessment.
An agreement in principle or mortgage offer is not an unconditional guarantee that the transaction will complete.
Should you wait until you have returned to work?
Sometimes waiting can improve lender choice, but it is not always necessary.
Waiting may help where the return date is uncertain, reduced hours have not been agreed, childcare costs are unknown, variable income is essential or the available lender will not accept future return-to-work income.
Returning to work can provide new payslips and bank statements showing the actual income.
However, waiting may add little where the employer has confirmed the return arrangements, the basic salary is sufficient, childcare costs are known and a suitable lender accepts the evidence.
Does being on maternity leave mean you need a larger deposit?
Not automatically.
Some lenders may accept the case on ordinary residential products where the income and expenditure position is satisfactory.
A larger deposit can reduce the mortgage required and may improve affordability, but it does not remove the need to evidence sustainable income or future childcare costs.
The deposit is only one part of the decision.
Common mistakes we frequently see
One common mistake is entering the normal salary without disclosing an intention to return on fewer hours.
Another is ignoring future childcare costs because they have not started yet.
Applicants also sometimes treat maternity pay as though it were permanent annual income or assume that enhanced employer pay will continue for the full mortgage term.
Perhaps the most serious mistake is making a mortgage commitment before calculating whether the household can manage during unpaid leave, the return-to-work transition and the first months of childcare.
How can FG & Cook help?
A maternity or parental-leave mortgage application often depends on presenting both the temporary and long-term household position clearly.
FG & Cook's specialist lending advisers can review pre-leave income, current leave pay, the return-to-work date, expected hours, basic and variable income, employer confirmation, childcare costs, other household income, deposit, credit commitments and current lender criteria.
This can help establish whether the application is workable now, whether further evidence is needed or whether waiting until the return arrangements are confirmed would produce a more reliable outcome.
First-time buyers can also explore FG & Cook's first-time buyer mortgage service, while our wider mortgage services explain the other types of borrowing we arrange.
You can contact FG & Cook before making an offer or submitting an application.
FG & Cook Financial Services Limited is an Appointed Representative of OSL Financial Services Limited, which is authorised and regulated by the Financial Conduct Authority under Firm Reference Number 948512.
Your home may be repossessed if you do not keep up repayments on your mortgage.
This article is intended for general information only and does not constitute personalised mortgage, employment, childcare-benefit, tax or legal advice. Lender criteria and individual underwriting decisions vary.