We recently supported a client who faced a common but complex challenge, using maintenance income for mortgage borrowing alongside an undrawn pension pot. Our goal was simple but significant: to help her maximise her borrowing potential and purchase her ideal main residence.
Our client, a dedicated professional working as an Associate Director, had a strong earnings profile including basic salary, commission, and an annual bonus. Alongside this, she received a court-ordered maintenance income, a substantial contribution to her overall affordability. However, this income was due to cease in five years’ time.
She also had an undrawn pension pot, which could not yet be accessed until she reached the eligible age. This blend of present and future income sources required careful structuring. Her ambition was to purchase a terraced home, using proceeds from her divorce settlement and existing property sale as the deposit.
The obstacle? Traditional lenders typically apply strict criteria, often refusing to take short-term maintenance payments into account for long-term mortgage affordability. A previous broker had advised that she could only purchase a home worth around £450,000, a significant limitation that didn’t reflect her true financial strength.
The previous broker was only able to utilise income from her employment as she was failing the typical lender criteria for maintenance income, namely that:
At 52 years of age, with one dependent close to finishing education, our client’s financial outlook was shifting. Her maintenance income had a clear expiry date, but her pension assets represented a reliable, long-term replacement once she could begin drawing on them. The key was designing an underwriting case that reflected this natural transition between income sources, maintaining affordability across the full mortgage term.
Our first step was to consider all potential routes available. We explored two key strategies:
Crucially, we needed a lender offering the following capabilities:
By presenting a clear, evidence-based income continuity plan, we demonstrated how the client’s financial position would evolve from reliance on maintenance income to pension income. This forward-looking model reassured the lender that affordability would persist beyond the five-year mark.
We worked closely with a specialist lender experienced in handling complex income streams. They accepted the proposed structure, taking a prudent approach by using the lower of the two income figures (maintenance or theoretical pension income) for affordability purposes. This balance ensured sustainable lending without overextending the client’s future obligations.
Through this tailored strategy, we successfully increased our client’s potential purchase price from approximately £450,000, as previously advised, to up to £700,000. This significant uplift opened the door to a wider choice of properties in her preferred location, and gave her the confidence to move forward with a clear financial plan.
The final arrangement not only addressed the short-term reliance on maintenance payments but also embodied a smooth transition towards independent retirement income. It was a solution built around precision, understanding, and forward planning — qualities that sit at the heart of every mortgage strategy we deliver at Private Finance.
This case study highlights the importance of holistic financial assessment and the value of specialist advice. Maintenance income and pension assets, when properly structured, can dramatically expand what’s possible in terms of mortgage affordability, especially for those navigating life transitions such as divorce or career progression.
Our approach demonstrates that the right lender, paired with strategic planning, can help clients unlock opportunities that traditional methods might overlook.
If this scenario resonates with you or you’re seeking personalised mortgage advice for another situation, please get in touch — we’d be happy to see how we can help. Call us on 0800 980 8777 or email info@privatefinance.co.uk.
Disclaimer:
The information presented in our case studies is intended for illustrative and marketing purposes only. Some case studies may be based on multiple enquiries or hypothetical scenarios to demonstrate typical processes or outcomes. Not all case studies represent completed business transactions, and the inclusion of a case study does not imply that the business was successfully concluded.
