Pregnant women could find it’s more difficult to get the mortgage that they want
Almost one in ten pregnant women who applied for a mortgage believed lenders had discriminated against them.
And a fear of being turned down by a provider has led a quarter of women to intentionally hide family plans during the application process, according to a survey by comparison site Uswitch.com
It comes after the Financial Ombudsman Service said that it has seen an increased number of complaints from pregnant women who say they have been unfairly rebuffed.
But can a provider really say no to a woman because she is have a baby?
In short, yes – but only if it means she would struggle to pay her bills.
Stricter mortgage rules that came into effect last year mean lenders must decide whether a person would be able to make repayments not only now, but also in the future.
If it’s believed a drop in income could jeopardise the ability to afford future mortgage bills, an expectant mother could be turned down.
A spokesperson for industry body the Council of Mortgage Lenders (CML) said: “Under the Mortgage Market Review, introduced in 2014, lenders are required to not only look at current finances when assessing affordability for a mortgage, but also any potential change of circumstance that could be reasonably foreseen at the time a mortgage is taken out.”
Women are not asked specifically about pregnancy by lenders, according to the CML, but can be asked for more information if they admit that they can foresee a change in their financial circumstances.
However, lenders should in theory also take into account partner income, as well as any savings that an applicant has.
Experts said that policies toward pregnant women varies, but generally it will reduce the amount that can be lent, as a number of providers then base the mortgage on statutory pay – rather than current earnings.
Daniel Bailey, mortgage broker at Middleton Finance, said: “Having a child will reduce the amount you can borrow as lenders will
take into account you will have a dependent to look after and also any potential child care costs.
“This will have a big impact on how much you can borrow and potentially getting the mortgage you need.
“It’s important to speak to a mortgage broker who can advise you on options available to you as lenders criteria does vary.”
If you believed you have been turned down as a result pregnancy – even though you would still be able to afford repayments – you can take your case to the ombudsman, who could force a provider to lend if sees that it has acted unfairly.
A spokesperson for the FOS said: “We don’t think it’s fair to penalise people solely because lending procedures don’t allow for being pregnant.
“Provided, of course, that you could still demonstrate you’re ability to pay even if your circumstances changed.
“Having a baby is something that many people across the UK will experience each year. And it goes without saying that being pregnant – or taking maternity leave – should not automatically preclude you from taking out a mortgage.”
Women who believe they have been treated unfairly by a lender should complain to the ombudsman.