Halifax has increased the amount of Disability Living Allowance (DLA) and Personal Independence Payment (PIP) income it will use in its mortgage affordability assessments from 60 per cent to 100 per cent.
It advised that brokers should continue to key the income under ‘other income’, and where it is entered the bank said advisers should ask borrowers how much of the income is used for related costs.
Such costs should then be entered as a credit commitment in the application under the category ‘other’.
If there are no costs, then no credit commitment needs to be entered.
Changes to how DLA and PIP are calculated apply to applications started from 17 January and a decision in principle (DIP) keyed in on that date will be subject to the new requirements.
Applications before this date, including those still at the DIP stage, will remain on the previous rules.
