SEISS grants and mortgage application

Tuesday1510

Hi, my partner is self employed and has taken both SEISS grants. I know this is in effect self-certifying that your business had an impact with Covid-19 but it has since gone back to normal. I have read on here that if you took the second SEISS grant you wont be able to get a mortgage at all. How true is this please? Feeling very disheartened. My employment has not been affected and we can have a 15% deposit soon. Thanks.

SELondoner77

Hi, I've just found out today that we are in the same position as you. Our mortgage broker only just flagged this up today 2 weeks down the line from an AIP when we asked for the formal application to be progressed.

I agree, it is so disheartening given that the SEISS was offered back when no one knew what the near future would bring, and my partner returned to work as soon as lockdown restrictions eased.  I would love to know whether anyone else who claimed it on both ocassions  managed to get a mortgage.

haras_n0sirrah

There are lenders who will lend with the seiss grants taken. I have had a number of offers for clients who have taken seiss and bounce back loans. We provided evidence that work was back to normal and in one case (cis contractor) a letter from the parent company confirming how much work booked in. Your latest 3 months bank statements need to show your work is back to normal - that is the crucial thing 

KwayzeeWabbitt123

We had a mortgage application accepted for a “decision in principle” but they took last three years of accounts, subtracted off the grants and then averaged. This put the first year of lockdowns in a loss situation which effected the amount we could borrow. I was advised though if I could show that my business was back up to pre-pandemic levels that they would take that into account but with a higher risk factor and added a slightly higher interest rate. 

There is always hope - get a good broker 😀

khtaylor

My partner and I currently have an application going through underwritting with Coventry BS. My partner is a sole trader and took the SEISS grants. 

K_S

For the benefit of others who may come across this thread -

In Jan 2022, as long as your business is back to normal (and can be evidenced through business bank statements, etc), having taken SEISS grants in the past is no longer a major issue with regard to mortgages. Some lenders will deduct grants from the net-profits which may impact affordability, some will not so it's just like any other income, some even ignore the covid-impacted year's accounts altogether. So, on its own it is not a huge issue as it was earlier in the pandemic.

[Deleted User]

also to add to KS comment,  just because a lender will fiddle affordability in a 'negative' way doesnt mean they wont be the best lender.   I had a case where the lender deducted the annual bounceback payments from the business profit and another one didnt.  The first lender still had a higher borrowing capacity due to other underlying affordability calculations.

If you have a healthy business and are borrowing 4x income then self employed is nearly back in the DIY category.   If you really need to push the loan amounts or you want to use net profit before/after corp tax or have anything that is less than vanilla then I would still recommend using a broker to navigate the market. 

khtaylor

Little bit of news for anyone worried about seiss grants and trying to obtain a mortgage! We have just had our mortgage offer through, no questions asked. From application to offer was 6 working days. A weight lifted off my shoulders! 
Get a good all market broker 

Bluellama

Great news - congratulations! Can I ask how they worked out the amount they were prepared to lend - e.g. did they take an average of your last three years of accounts, just look at your 2020-21 accounts, etc? And did they deduct the SEISS grants or include them in their calculation of your income?
Good luck with your move!

khtaylor

I have a perm part time job and my partner is self employed. We went with a broker and it was difficult to get a big enough mortgage with the typical 'high street' banks. 

We ended up getting a DIP with Coventry BS. We had to submit my last 3 months pay slips, p60 and 3 month bank statements. And my partner had to submit 2 years tax returns and 3 months bank statements. I believe the seiss grants were deducted from my partners income. 

You should speak to a mortgage broker and they will advise and search whole of market for you. Honestly best thing I done