On parental leave your income now is lower than it will be for most of the loan, and lenders handle that differently.
Often, yes. Some lenders assess your usual salary if you provide a return-to-work letter with the date and hours and have savings to cover the gap; others assess only your reduced income, which can halve the borrowing figure.
Choosing the lender, and timing the application around your return, decides the result.
Part of the employment and income home loans guide.
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If you are returning at reduced hours, that reduced figure is generally what a lender will use, because it is your actual ongoing income. Where part-time is the plan, the assessment should reflect it from the start rather than being corrected later.
That is fair, and it is also worth planning around: a household budgeting on a full-time return that does not eventuate is exposed. Our guide to part-time income covers how lenders count it.
Treatment varies. Some lenders will count government parental leave payments, some will not, and where it is counted the treatment is usually conservative because the payments are time-limited by design. Employer-paid parental leave is a different question again and depends on the arrangement.
Neither should be assumed either way without checking the specific lender's written position.
Four factors, and the first one carries most of the weight.
Frequently yes, and the deciding factor is usually evidence rather than eligibility. Lenders whose policy accommodates parental leave will assess you on your return-to-work income where you can produce an employer letter confirming the date, role, hours and salary.
Without that letter, the assessment tends to fall back on the reduced income you are currently receiving.
That you are on approved parental leave, the date you return, whether the return is full-time or part-time, the hours, and the salary or rate on return. Specific and dated. A vague letter is worse than useful because it invites questions rather than answering them.
Sometimes: it varies by lender, and where counted the treatment is usually conservative because the payments are time-limited. Employer-paid schemes are assessed differently, so settle it before you apply.
Sometimes, and sometimes not. If the return is documented and a suitable lender exists, waiting may cost you a year of the market for no gain.
If the return is uncertain or part-time and the file is tight, waiting may be the better call. It is worth having the numbers on both before deciding.
Yes, slightly: the same income questions apply, but a straight rate-driven refinance with no extra borrowing is a more modest ask than a purchase. It is still a fresh assessment, not an automatic switch.
Charles can tell you what your file supports now, and whether waiting for the return changes it.
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General information only, not credit or financial advice. Professional lending policies, eligible occupations and loan-to-value thresholds vary by lender and change over time. Eligibility is confirmed against current lender policy in an assessment; nothing on this page is a promise that any lender will approve any application.
