Halifax has quietly implemented a significant positive change for mortgage applicants relying on bonus income, potentially opening doors for many who have recently switched employers. Previously, borrowers needed a two-year bonus history with the same employer for their bonus income to be fully considered. This requirement often penalised individuals who had demonstrated consistent bonus earnings but had moved to a new company within the last two years.
Under the updated policy, Halifax will now include a bonus received from a previous employer in the prior year when calculating the two-year average for annual bonuses. The calculation method remains the same: the lender will use the lower of the bonus received in the latest year or the average of the bonus received in each of the last two years. However, the crucial difference is the inclusion of that previous employer’s bonus, providing a more holistic view of a borrower’s earning potential.
This adjustment is a welcome development for the mortgage market. It acknowledges the reality of modern employment trends, where professionals often change roles. For applicants with a strong track record of bonus earnings, this change could significantly boost their affordability assessment and make it easier to secure the mortgage they need. Borrowers who might have previously been constrained by the “same employer” rule should now revisit their mortgage options with Halifax.
Ready to see how this change could benefit your mortgage application?
At Orton Financial, we specialise in navigating complex mortgage scenarios and staying on top of the latest lender policies. If you’ve recently changed jobs or rely on bonus income, our expert advisors can help you understand your options and find the best mortgage solution for your unique circumstances.
Contact Orton Financial today for a free, no-obligation consultation. Let us help you unlock your homeownership dreams.