Broker advised that banks would not need certified accounts...Banks say they do

arthur_22

I've had an offer accepted on a house. I'm self-employed. I carefully took myself off to a broker to check what proof of income I would need (I do my tax returns myself) and I was told the tax returns themselves would be sufficient.

Phoned two banks today, and both said they would need three years certified accounts.

Help! I only offered on the house based on my broker's advice that I had sufficient paperwork...now what?! Are there any banks that just need tax returns?

ILW

Were these applications put to the banks via your broker?

arthur_22

No - the broker advised that the best deals for me were available if I applied direct with the bank. I was halfway through an application with one bank today when they mentioned the accounts issue, and I just phoned the other bank (the second best mortgage my broker had recommended) straight afterwards to check whether they asked for the same proof.

GMS

Do you have the last 3 years tax returns done? If so you should have received a SA302 form from the Inland Revenue which will show your earnings.

Speak to the lenders and ask them will they accept these. They should do as this is Inland Revenue proof. There is no legal requirement to have an accountant so self assessment is enough.

Out of interest which lenders have asked for this from you?

arthur_22

Yes, I have three years of tax returns all done and ready, with the SA302 forms. I asked specifically if they would accept these and was told a firm "no". This is First Direct and HSBC....

opinions4u

The lender has the right to determine what proof of income it wants.

I'm surprised a broker volunteered knowledge of HSBC underwriting when they don't accept loans introduced by a third party.

Could you get an accountant to pull something together within the next week or two?

GMS

Of course the lender can choose what proof it wants but if a client has Inland Revenue proof of earnings then that should be sufficient.

An example of a good broker that. Informing the clients of the best deal available regardless of whether the lender deals with brokers or not.

If the lender insists on an accountant they may also insist on the accountant having acted for the client for a minimum period, such as 12 months. This may not help.

Try to speak to an underwriter stating you can prove last 3 years income with Inland Revenue documentation. Ridiculous for them not to accept this.

Good luck

dunstonh

Banks often get accounts requirements mixed up. i.e. requested audited accounts when the person is self employed. (audited are for limited companies).

By certified, they probably mean just normal accounts prepared by an accountant. Most self employed will have that anyway unless their business type is very straight forward or its more of a hobby. The HMRC info mentioned higher up should suffice in that case with some lenders.

GMS

opinions4u wrote: »

The lender has the right to determine what proof of income it wants.

I'm surprised a broker volunteered knowledge of HSBC underwriting when they don't accept loans introduced by a third party.

Could you get an accountant to pull something together within the next week or two?

You are surprised a broker volunteered the information. Why? This is what a good broker will do. Search the market and recommend deals to clients. In this case there may well have been no fees involved for the broker but the client got best advice, and the broker adhered to 'Treating Customer's Fairly'

Once again an assumption made against broker's.

opinions4u

GMS wrote: »

You are surprised a broker volunteered the information. Why? This is what a good broker will do. Search the market and recommend deals to clients. In this case there may well have been no fees involved for the broker but the client got best advice, and the broker adhered to 'Treating Customer's Fairly'

Once again an assumption made against broker's.

You misunderstand my point. No need to lecture me about what a broker does.

I'm not remotely surprised that they pointed their customer in the direction of HSBC for the most suitable mortgage product.

My surprise was around the broker's assumptions on HSBC underwriting policy which they would be unlikely to have a strong knowledge of - that said, there is still a reasonble possibility that HSBC don't know their own underwriting policy on this one!

GMS

Apologies for the misunderstanding. Plenty of posts here accusing brokers of all kinds of no good.

Personally I cannot see why HSBC would not take SA302 documentation. You may well be right about them not knowing their own policy!!