Barrister Mortgages and Maternity Leave

The first female was called to the Bar in 1922, only 90 years ago and the number of women practicing in the last two decades has significantly increased. Women are conquering the legal profession, but there is evidence, there has been far less success in the financial world. This is particularly so, when considering the issue of maternity leave. Barristers seeking barrister mortgages are treated like any other self-employed person, but whilst the impact of maternity leave on all women looking for mortgages is significant, the impact on a Barrister can be hugely problematic.

Chambers are now required to have both pregnancy and maternity policies safeguarding women barristers and the Bar Council have been at the forefront of these changes, for over 20 years. The policies are regularly revised and require Chambers to offer rent free periods, now up to 6 months to reflect the maternity period norm existent in the employed world. However, despite these moves, there remains many practical difficulties experienced by female Barristers such as their availability for trials listed post birth, rebuilding their practice and solicitors relationships on return to work and the simple period of absence from self-employed advocacy practice, resulting in not earning or receiving pay. These become significant factors when assessing affordability of a Barrister taking or on maternity leave, making standard lending decisions, highly subjective and at times problematic.

It has to be accepted that the Bar is one of few professions where business leverage is not facilitated. A self-employed accountant can employ other accountants in their absence to continue the practice as can solicitors, dentists, doctors and vets. If a Barrister is unavailable for work, she is unavailable for work, she can neither sell or locum her cases or client base and whilst on maternity leave, no advocacy income from the client base can be generated. Every day on maternity leave is a day unemployed to today’s advocate. There are no insurance protection policies to provide an income safety net and few Barristers Chambers provide cash lump sums to enable Barristers to get through this period.

As lenders move away from assessing credit decisions using basic income multipliers and move to the assessment of overall affordability, maternity leave for a Barrister can be a detrimental factor. Banks are duty bound to treat all applicants fairly, but the knowledge of a Barrister taking 6-12 months maternity leave, with no planned income replacement, has to be a proper consideration for any lender undertaking responsible lending.

The historical build-up of an aged debt may mitigate income during this period, but those without an aged debt or modest aged debt, effectively are reliant upon their partner’s income or ultimately state assistance through benefits.

The concern over the treatment of maternity leave for all women has led to proposed rule changes by the Financial Conduct Authority who have highlighted pregnancy and maternity leave as “a potential for concern.” There is also an array of sex discrimination legislation and the Equality Act which should prevent adverse treatment but such protection, has to be dove tailed with a lenders fundamental consideration of whether any mortgage contract will remain affordable and this clearly poses some dilemma.

The issue of affordability during the maternity period due to a reliance on self-employed income seems only one factor. This is also coupled with a concern that returning Barristers may choose more flexible work practices. The Bar, with the assistance of supportive clerks can well facilitate this. However, whilst the profession, is well suited to such arrangements, the impact of motherhood can have a significant impact on mortgage affordability as both time off to have the baby coupled with a potentially flexible return to practice and resulting impact on earnings, serves to raise the anxiety of even the most hardened of underwriters. The financial effect of maternity leave on a Barrister’s practice has never been fully researched but anecdotal evidence from female Barristers indicates that maternity does have an impact.

The Bar has worked hard with Chambers to mitigate discrimination, but whilst inroads have been made within the profession, the next battle may need to be with Bank underwriters within the financial world.