What is the potential downside when applying for mortgages or personal loans after entering a significant salary sacrifice arrangement?
Answer
Lenders assess affordability based on the stated gross salary, which appears reduced on documentation
Financial providers responsible for assessing creditworthiness, such as mortgage lenders, primarily look at the stated gross salary on documentation. A reduced gross salary due to sacrifice might negatively affect perceived affordability, even if the take-home pay is sufficient.
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