Difficulties in remortgaging when paid in cash

Razzelle

Our fixed rate will be up towards the end of the summer so may be looking to remortgage.  Both my husband and I work full time and have done so for our respective employers for many years.  We are lucky in that our jobs have not been impacted by COVID-19.  So far so good...except the last two times we have done this we have faced extreme difficulties and even had one remortgage refused because my husband gets paid cash.  He works for a small family business and despite numerous requests over the years to have his wages paid into the bank his employer will not do this.  We had payslips (and checked these matched what was on his gov.uk account) and there is a record of the cash getting paid into the bank account by one us every Monday.  The amount paid into the bank either matches exactly his net income on his payslip or is less if I have spent some of the cash at the weekend!  All this matched up to his P60.
Despite already having a mortgage with Santander (and banking with them) they refused us a remortgage 3 years ago on the grounds that hubby gets paid in cash.  We have never missed a payment, never been in arrears and affordability etc. is well within the limits and both have 'excellent' credit scores etc. They just simply said getting paid in cash was too risky and looked like money laundering.  I should point out at this stage his net income per week is around £400 so hardly think we are money laundering!
I understand that getting paid 'cash in hand' can be considered 'dodgy' but when hubby has payslips which match his P60 and his gov.uk tax account, and the money being deposited into the bank, is this not sufficient to prove his income?  And IF (a big IF) his boss is doing something dodgy with his his business accounts it is of no business to our mortgage lender so long as hubby's employment and income is safe and above board (at this point I wonder if the banks are as cautious when awarding their own employees mortgages when they know they don't always run their banks above board!).
Hubby is in the process of asking his boss again to be paid into the bank but we just know he will say no again, and under the present climate hubby is unable to move jobs or risk pushing this and then being unfairly dismissed!
So I suppose I am looking to arm myself with some weighted arguments or evidence to throw back at the banks should we have difficulties in the summer for the same reason i.e. being paid cash.  Or a list of banks/lenders that don't have this issue...we're currently with Virgin and first option will be too look at their deals in the summer and hopefully avoid the hassle of moving lenders!

mrsS_2

It could be the employer is just very old fashioned and has always paid cash and always will.
it could be that the employer is paying your husband in cash to save on the bank charges that they have to pay, to pay the cash in that they receive and that there is nothing “dodgy” about it at all.  

However given that the amount of cash transactions has nose dived since the pandemic hit, it does raise a flag as to why the company is getting paid in cash?   Depending on the industry, of course!   It would probably be useful to have an explanation ready.
The mortgage company may be considering the viability of the company, the possibility of tax fraud etc when they look at the risk profile.  If the employer gets done for tax evasion, your husband may not have secure employment after all, regardless of whether his payslip agrees to his tax account and the amount received.   
Not trying to imply that the company is doing anything wrong, just trying to think like the mortgage company 

[Deleted User]

There are some high street lenders that take cash payments but it has to be paid in to the bank each week/month and be proved historically.  They also tend to go for employment references to confirm.

Its something that comes up quite regularly and most brokers should know which lenders to avoid

Thrugelmir

Out of curiosity what's the nature of the business? From the lenders perspective if the business is "dodgy" then your husbands employment may well be at risk. 

Razzelle

Thanks all. My hubby is a butcher and works at one of 2 shops that his employer owns. He has worked there for 7 years and before that his previous employer was also a family run butchers that paid cash too. The majority of transactions in the shops are cash, even during the pandemic when card use was preferred method of payment. The shop is in what could be classed as a deprived area and most of the customers will be on tight budgets and prefer cash to cards.... been like that since it opened in the mid 1990's.  So it's easier (and probably cheaper) for his boss to pay them in cash when the tills are full at the end of the week.
I am just dreading doing this all again...even with a Financial Advisor last time I still had a lot of additional 'jumping through hoops'  and had to be grilled over the phone by the bank (I probably should point out here that I used to process mortgages for a well known building society many years ago so am not completely ignorant in this area 😄). I've lost count how many mortgages we've had since we bought our first house in 2000 and have never had arrears, missed payments or done anything to adversely affect our credit ratings...but hubby has always been paid cash. The last couple of times were so stressful and it just seem to be getting harder each time the remortgage is due! 

sammyjammy

Can you not just choose another product with your lender?

Razzelle

sammyjammy said:

Can you not just choose another product with your lender?

That wll hopefully be an option if they have a decent deal when the time comes. Santander wouldn't let us have another deal, they would only keep us on their standard variable rate!