Unfortunately I doubt it is going to be quite as simple as Pinksteroo has suggested.
When you received the "quote" was this specifically based on an underwritten assessment of your tax credits or was it someone asking if you received these benefits and then taking them into account for an off the cuff quote?
it is most likely that it is the latter and that once the documents have been submitted to the lender there has been an anomally within the documents that means they can no longer accept the benefit. Most common is that the income that you have declared on thr application is different to that which has been claimed through the tax credits. This in my experiance accounts for around 50% of all ttax credit documents given to me and the lender will immediately remove the benefit from any calculation until a new awards letter showing the correct income or circumstances is given. It could also be that the award is given in 2 names (mother and father of the children) but often it is only 1 person applying for the mortgage. In cases like this the lender will not allow the benefit unless both named claimants are on the application. It could also be that while the parent is the sole parent of the child and the benefit is genuine and awarded correctly but they may be applying for a mortgage with someone else, this means that as a means tested benefit it would be reduced if the other applicant is working as there will be more money coming into the household than declared on the benefit
I would find it extremely doubtful if one lender would decline the use of the award and another will accept it. Most lenders criteria are very similar around areas like this and truth be told there are probably as many lenders that just will not take tax credits as an acceptable form of income as thoses that will.
I think that on an income of £25750 you are really going to be pushing your affordability about as far as it can go and probably to the point that it is unaffordable. On the assumption that no other lender will accept the tax credits but will accept the child benefit then potentially you could just afford the mortgage on your own but not many lenders do accept child benefit in the first place. Another additional down side is that as if you are a lone parent then you are going to have the child as a sole dependant on your income and this will reduce what you can borrow further to pay for the childs welfare. On top of this you will need to have absolutely squeaky clean credit to gain a full 5x income award and this is not likely if you do not have a mortgage in place at present as this is about the only way to get a maximum credit score with a lender. (Credit reference agency high score is not the same as a mortgage lenders high score)
Doing a quick check on a lenders website (who can offer 5x income) and looking to take the loan over 30 years with an asumption of 1 child and no debt what so ever and using your base income and child benefit their calculator says that with an acceptable credit profile you could borrow around £90k but with a high score your could get as much as £130k....but not £135.
You need to speak to the lender, or broker and find out WHY the tax credits were not accepted. If you can then get your award changed then you may be able to get them used in the calculation but it will mean that your benefit could be reduced because of this. If the award is correct but the benefit cannot be used for another reason then I think you may need to evaluate if this is the right property for you to take on.
Pinksteroo: If you have already have a survey done, this may be portable to other mortgage lenders (potentially you might find a lender who is a sister company or subsidiary of the current one you are trying to obtain).
If it is a sister company you will almost certainly have to pay an additional fee to rewrite the report on the new lenders paper, this fee is often up to £100. If it is not a sister company it may be hard to have them accept the report if the surveyor is not on their panel or surveyors. If this is the case then you will have to pay for a new survey.
On the face of what you have put down, if you had walked through my door I would be suggesting that you think carefully about trying to take this house on as to me it appears it may be just outside of your price range for your circumstances. Not what you are wanting to hear but I don't think you will find a lender who will help you. Best chances in my opinion would be either Nationwide BS or Sanander, both these lenders accept not just tax credits but also the child benefit an can potentially lend you up to 5x your income, not many lenders will accept child benefit at all. If you have tried either of these and they have said no then I would seriously reconsider your position.
Good Luck
