Can Overtime, Bonuses or a Second Job Count Towards a Mortgage?

Yes, overtime, bonuses, commission and income from a second job can sometimes be included in a mortgage application.

However, a lender may not use all of the additional income you receive. The amount accepted will depend on how regularly it is paid, how long you have received it, whether it is likely to continue and the lender’s individual criteria.

This can make a significant difference to your mortgage affordability. Two lenders reviewing the same payslips could use different income figures and arrive at different borrowing amounts.

Whether you work regular overtime, receive performance bonuses, earn commission or have more than one job, this guide explains what lenders may consider and which documents you could need.

Can overtime be included in a mortgage application?

Many lenders can consider overtime when assessing mortgage affordability, but they do not all calculate it in the same way.

A lender may review a selection of recent payslips and calculate an average. Some may compare the recent figure with income received over a longer period, while others may only use a proportion of the overtime.

The lender will normally want to establish that the overtime is regular, evidenced and reasonably likely to continue. Occasional overtime received during an unusually busy month may be treated differently from additional hours worked consistently throughout the year.

The type of overtime can also matter. Contractual or guaranteed overtime may be viewed differently from optional or irregular overtime, although the wording on an employment contract does not automatically determine what every lender will accept.

How much overtime income will a lender use?

There is no single calculation used across the mortgage market.

Depending on the lender, the amount used could be based on:

• An average of recent overtime payments
• An average over a longer period
• The lower of the recent figure and an annual figure
• A proportion of the overtime rather than the full amount
• A figure supported by a P60 or other evidence of previous earnings

A lender may also consider whether the recent overtime is consistent with your occupation and normal working pattern.

This is why entering your total annual earnings into a basic mortgage calculator can sometimes produce a misleading result. The calculator may assume that all the income will be accepted when the lender’s criteria say otherwise.

You can read more about the wider affordability assessment in our guide to how much you could borrow for a mortgage.

Can bonus income count towards a mortgage?

Bonus income can sometimes be included, whether it is paid monthly, quarterly or annually.

The lender may consider how frequently you receive the bonus, how long you have been receiving it and whether the amount is consistent. A guaranteed contractual bonus may be assessed differently from a discretionary performance bonus.

For an annual bonus, a lender may request evidence covering more than one year. Where the amount has changed, the lender might use an average, the latest payment or the lower figure. The exact approach varies.

If you have recently changed employer, a previous bonus history may not automatically be accepted. Some lenders may consider it alongside evidence from your new role, while others may require a new history to be established.

Can commission be included in mortgage affordability?

Commission can also be considered by some lenders, particularly when it forms a regular part of your earnings.

A lender may review recent payslips to establish an average and may compare this with the income shown on your P60. If your commission varies significantly, the lender may take a more cautious approach.

It is important to separate recurring commission from expense reimbursements or one-off payments. Money appearing on a payslip does not automatically mean it will all be treated as mortgage income.

Can income from a second job be used for a mortgage?

Some lenders will consider income from a second job, but they may want evidence that the arrangement is established and sustainable.

The lender may consider:

• How long you have had the second job
• Whether the employment is permanent, temporary or on a zero-hours contract
• The number of hours worked across both jobs
• Whether the working pattern appears sustainable
• Whether the income is regular
• Whether the role is likely to continue

A permanent second job held for several months may be treated differently from a role that started very recently. Temporary, casual or zero-hours income may require a longer earnings history.

Having more than one job does not automatically prevent you from getting a mortgage. The lender will want to be comfortable that the working pattern and resulting income can continue without placing unrealistic demands on you.

What if I have only recently started earning overtime?

Recently started overtime can be more difficult to include because there may not be enough evidence to show that it is regular and sustainable.

That does not mean every lender will disregard it. The outcome may depend on why the overtime has started, whether it is guaranteed, your employment history and the evidence your employer can provide.

For example, a permanent change to your contracted hours may be viewed differently from temporary overtime covering a colleague’s absence.

If your income or role has recently changed, our guide to getting a mortgage with a new job or during probation may also be helpful.

How do lenders assess NHS, care and shift-work income?

Many people working for the NHS, care providers, emergency services, factories and other shift-based employers receive a combination of basic pay and additional earnings.

This could include:

• Overtime
• On-call payments
• Night-shift enhancements
• Weekend enhancements
• Bank work
• Location or responsibility allowances

A lender may classify each element differently. A permanent shift allowance could be treated differently from variable overtime or occasional bank work.

The wording and structure of the payslip are important. Before an application is submitted, each income element should be identified correctly and checked against the lender’s evidence requirements.

What documents might you need?

The documents required will depend on the lender, how frequently you are paid and the type of additional income involved.

You may be asked for:

• Your most recent payslips
• Several months of payslips showing overtime, bonuses or commission
• Your latest P60
• Recent bank statements showing your salary credits
• Your employment contract
• A letter from your employer confirming your role, hours or income
• Payslips and employment details for a second job

The figures on your mortgage application should match the supporting evidence. If there is an unusual payment or a significant change in your income, the lender may ask for an explanation.

Our guide explaining what mortgage lenders look for on bank statements provides more information about the wider document review.

Will using overtime increase how much I can borrow?

If a lender accepts some or all of your overtime, bonus, commission or second-job income, it could increase the income used in its affordability calculation.

However, the income figure is only one part of the assessment. The lender will also consider:

• Your regular household spending
• Loans, credit cards and car finance
• Childcare and maintenance payments
• Your deposit
• Your credit history
• The mortgage term
• The property being purchased

A higher income figure does not guarantee a particular borrowing amount or mortgage approval.

Should I reduce my overtime before applying?

Not necessarily. If overtime forms a normal part of your income, reducing it before applying could mean that your most recent payslips no longer reflect your usual earnings.

However, you should not take on an unsustainable number of hours simply to increase the income shown on an application. Lenders may consider whether the working pattern is realistic and likely to continue.

The most helpful approach is to present an accurate picture of your normal income and discuss any recent changes before choosing a lender.

Why lender choice matters

One lender may accept a large proportion of regular overtime while another uses a smaller amount or requires a longer history. Similar differences apply to bonuses, commission and second-job income.

This means the lender offering the lowest advertised interest rate may not necessarily provide the borrowing amount you need or suit the way you earn your income.

A mortgage adviser can compare both the mortgage products and the underlying criteria before an application is submitted.

You can read more about this in our guide to using a mortgage adviser or going directly to a bank.

How Cariad Mortgage Solutions can help

At Cariad Mortgage Solutions, we take a holistic approach to mortgage advice. We are about putting people first and products last.

We look beyond your basic salary and take time to understand how you actually earn your income. This includes overtime, shift enhancements, bonuses, commission, second jobs and other regular earnings.

We can review your payslips and employment information, establish which income may be usable and identify lenders whose criteria are better suited to your circumstances.

Our support also goes beyond arranging the mortgage. We can guide you during the house-hunting process, help with arranging and presenting offers to estate agents, assist you in finding solicitors and surveyors and communicate with the lender and the other professionals involved.

We remain by your side throughout the process, right through to completion and beyond. Even after you have collected the keys, we will continue to be a point of contact when you need us.

We are based in central Swansea and support clients throughout South Wales and across the UK.

Mortgage advice with heart.

Ready to understand how your income could be assessed?

If your earnings include more than a straightforward basic salary, you do not need to work out the lender calculations alone.

You can:

• Book an initial telephone consultation
• Contact our Swansea office
• Use the WhatsApp button on our website

We will listen to your circumstances, explain what may be realistic and help you understand your next step.

Frequently asked questions

Suggested reading

• How Much Can I Borrow for a Mortgage?
• What Do Mortgage Lenders Look for on Bank Statements?
• Can I Get a Mortgage With a New Job or During Probation?
• Should I Use a Mortgage Adviser or Go Direct to a Bank?

Your home may be repossessed if you do not keep up repayments on your mortgage.

There may be a fee for mortgage advice. The fee will depend on your circumstances and will be discussed with you before you proceed.