Last Updated on 11.7.16 by Gorvins
Pregnant women, those on maternity leave or even those just thinking about starting a family are being discriminated against by mortgage lenders.
It has come to light that in the last decade almost one in 10 young women who have applied for a mortgage have been denied because they were pregnant, had just had a baby or were intending to have one in the future. For many women, buying a house and starting a family are often synonymous, yet many mortgage lenders are not aligned to that view.
The news comes from the Financial Ombudsman, which has received a heightened number of enquiries from women who believe they have been discriminated against by their mortgage lender. It has been cited that a quarter of women thinking the current affordability criteria doesn’t match up to modern family finances, but lenders do have a responsibility to make sure an individual or a couple can afford the repayments without entering into financial troubles. The problem comes however, when this decision is based on a broad-sweeping assumption.
In 2014, the Financial Conduct Authority introduced a new stream of home loan affordability tests to limit irresponsible lending, which included asking women about their intentions in relation to starting a family. The information from the Financial Ombudsman tells us that women have applied for a mortgage unsuccessfully after divulging information regarding their pregnancy status or future intentions.
Caroline Wayman, the chief executive of the Financial Ombudsman Service said, ‘It is not fair to just make blanket assumptions about people, based on certain characteristics – age or maternity. It certainly wouldn’t be fair just to say “because I think you’re pregnant, I can’t lend you”. People are entitled to a private life, so I think there’s a limit as to what lenders can ask.’
Prove you can cover your out-goings
Before you apply for a mortgage you need to make sure you can cover your financial out-goings. This applies even more so if you are a pregnant woman or are planning to start a family as your income is naturally going to decrease.
However, if you can demonstrate that you have the financial capability to cover the costs given your change in circumstances or whilst you are on a reduced income, your application should not be automatically rejected because you are in a certain ‘category’.
Give Gorvins a call
At Gorvins we can help you with your specific situation. If you are looking to purchase your first house, upsize or even re-mortgage your existing property we want to make it as stress free as possible. Call us today for a no-obligation quote on 0161 930 5151 or even just to chat to us about your current property plans and we can help you with the process.
Similarly we also offer advice and support to working mums who feel they are being discriminated against at work because of their pregnancy or maternity leave. More information can be found at our Keeping Mum page.