Who this covers: households where one partner is on paid or unpaid parental leave, returning part-time, or planning a second child.
What lenders do differently
The return-to-work letter
Most lenders count the pre-leave salary where the employer confirms the return date, hours and pay in writing, and the return is within three to six months. Some count it at the return hours only; a few count only income currently being paid.
Paid leave, government and employer
Employer-paid leave at full pay is usually counted as salary for its duration. The government Parental Leave Pay scheme is counted by some lenders while it is being received. The year-to-date on the payslip drops during leave, which is why the letter matters.
Savings to cover the gap
Where the household cannot service the loan on one income for the leave period, lenders look for savings that cover the shortfall until the return date, and some ask for them to be set aside.
Childcare and expenses
A dependent adds to the living expense benchmark, and childcare fees are counted as an expense where they are known; the subsidy reduces the figure. A second child planned is not asked about, and cannot be.
Worth knowing before applying
A pre-approval obtained before the leave started often needs re-confirmation; a part-time return is assessed at the part-time pay; and the borrowing capacity calculator shows the household figure at the return hours.
The tools that fit
Policies on all of the above differ lender to lender and change without notice; the value of the conversation is knowing which lender's policy reads your payslip best on the day. Understanding how your income is read before you apply is what makes the application calm.