Mortgage companies who are reasonable about SEISS

letsgoagain

HI folks,

I'm currently trying to apply for a mortgage, and thought I might try and gather some ideas that might also help others in a similar situation to myself.
Has anyone been successful with a mortgage application, having previously applied for SEISS? If so, which lender?
I've waited weeks for my appointment with NatWest, only to be told in the first few minutes that SEISS would be a problem (I don't know why they couldn't have told me that when I called to book an appointment). So others may find that useful to know.

My situation:
I've been self-employed for three years. Business is doing well and growing every year. Back in June it looked like I would lose some business (and I did lose a little, though not much), so I claimed the first grant. Things have improved since then and I'm on track for this to be my best year yet. Obviously I don't plan to claim the second grant.
I've had an offer accepted on a house and am now trying to get a mortgage finalised. It's not a very expensive house and I have a 20% deposit ready to go. Good credit history, no debts. All my business income goes into my NatWest account, and shows very steady income over the past several months. I thought it should be straightforward.

My experience with NatWest:
The NatWest advisor told me that their policy is this: if you've claimed the SEISS grant, they will multiply it by 4, and use that as your income. That's it. Your previous years don't matter (even though they ask for those tax returns), your last several months of business accounts don't matter. Only the SEISS grant. 
The advisor clearly thought this was a bit silly, and said she would try something for me. Her suggestion was that I could promise to pay back the grant, and she would put the application through just based on my income. If the underwriters approved (which, she thought, they probably wouldn't), then the mortgage would be issued pending confirmation that I'd paid back the grant to HMRC.

My take....
I understand the banks want to be cautious - and by taking the grant, yes I'm saying my business has been affected. But it's very frustrating that my previous years' growth and this year's recovery count for absolutely nothing, and my sustainable £50k income is reduced to £16k. Honestly it seems bonkers to me.....the grant is the only part of my income that I'm guaranteed to never get again, yet it's the only thing they'll take into account!

OK, that turned into a bit of a rant. I'm waiting for a call back from a broker so hopefully they can help. I also have an appointment with HSBC but that's two weeks away....they did ask for previous 60 days' accounts though so maybe they're willing to look at that.

In the meantime, I'd love to hear if anyone's had more success with a bank being a bit more discerning when it comes to self-employed people applying for mortgages.

dunstonh

Use a local broker.  Do not go straight to a lender.  You will find it a lot easier in this situation.

letsgoagain

dunstonh said:

Use a local broker.  Do not go straight to a lender.  You will find it a lot easier in this situation.

Thanks, yeah I'm realising that now. Wish I'd just done that to start with! Waiting for a call back from L&C.
When you say "local broker", do you specifically mean one near where the house is, or one near where I currently live? Does it matter? The reason I ask is because both are rural locations without much in the way of financial services. Could I do better than using a London-based national company? (House is in highlands, which is also where I currently live).

söpöpöllö

letsgoagain said:

dunstonh said:

Use a local broker.  Do not go straight to a lender.  You will find it a lot easier in this situation.

Thanks, yeah I'm realising that now. Wish I'd just done that to start with! Waiting for a call back from L&C.
When you say "local broker", do you specifically mean one near where the house is, or one near where I currently live? Does it matter? The reason I ask is because both are rural locations without much in the way of financial services. Could I do better than using a London-based national company? (House is in highlands, which is also where I currently live).

I think the big free broker firms are fine when your situation is very straight forward, but otherwise it's probably more effective to use one that charges a fee. I'm self-employed (didn't need SEISS but otherwise my income is a bit complex) and the first broker was just waste of time. They couldn't be bothered with our case at all once they realised it's wasn't your average case. They don't have to be physically local to you but just be wary that the free ones are not necessarily going to be that helpful. There are a good few brokers on this forum that you can contact as well.

MovingForwards

Use a proper broker, not L&C as your income isn't straight forward this year.

If your unsure where to find one several post on MSE.

[Deleted User]

I've had 2 clients come back to me this week when they previously said they didn't want to pay a fee. Both got pretty much ignored at the big conveyor belt brokerages. 

Self employed cases need more time at the moment and most big firms only want the easy business. 

Saying that, there are lenders who are good for self employed.  Natwest are probably the worst out of all the high street lenders but some are able to make common sense decisions

letsgoagain

Thanks all, that is helpful. I'm not against paying a broker if they get the job done, would rather that than waste any more time. I've got an appointment on Monday for a more local broker, so will see how that goes. Fingers crossed!

letsgoagain

To add - the broker is a small, family-owned firm. They said they don't charge "in most cases", but might if the situation is complex. I'll assume I fall into the latter category which is actually reassuring, sounds like they'll bother to do the thing properly.

monetxchange

I'm currently using a broker as I'm also self employed and took SEISS. He's now got me an agreement in principle with Santander by managing to get them to take my yearly income based on my last two tax returns to make an average. They don't like the SEISS, but only if it makes it look like you've had a large downturn in income this year. Definitely get yourself a broker. Mortgages for self employed are extremely complex at the moment and you need someone who knows who to approach.

letsgoagain

monetxchange said:

I'm currently using a broker as I'm also self employed and took SEISS. He's now got me an agreement in principle with Santander by managing to get them to take my yearly income based on my last two tax returns to make an average. They don't like the SEISS, but only if it makes it look like you've had a large downturn in income this year. Definitely get yourself a broker. Mortgages for self employed are extremely complex at the moment and you need someone who knows who to approach.

Thanks, that's reassuring to hear. Evidently I was a little naiive. I got an AiP from two banks (including NatWest) for far more than I actually want to borrow, before making an offer. In all their communications up to this point, they've just said I'll need my tax returns, which is no problem. And since my NatWest account shows my business doing well over the past few months, I thought it would be fine. Apparently not. Anyway, broker meeting on Monday and hopefully we can progress quickly from there. My seller has been incredibly patient through all this but I don't know how much longer I can drag it out for!

dunstonh

When you say "local broker", do you specifically mean one near where the house is, or one near where I currently live? Does it matter?

It doesn't have to be local.  However, the smaller independent firms tend to have a lot more experience than the direct/internet based factory line services.  Mainly as they are not targetted to do so many cases a day and that the brokers in smaller firms will see the case through from beginning to end and wont be handing it off to unqualified cheap call centre staff to do the work on.

So, its more an indication of the type of business rather than physical location.