Self-assessment candidates seeking mortgages should plan ahead and be diligent with accounts
Those who are self-employed and relying on self-assessment income figures for mortgage and remortgage applications should plan ahead and be diligent with book keeping, following a rise in reference requests and lead times in obtaining confirmation of figures from HMRC.
We have found there is a trend emerging in lender requests for form SA302, which seem to be used as a third party check for the lender to ensure the information they are lending on is accurate. This form must be obtained from HMRC and can take up to two weeks to arrive.
At Adams Moore, we have seen a sharp increase in clients looking to remortgage at present and asking for a reference for the last three years figures. Given the lead times in obtaining the forms and the fact that the information entered on the application must match what we, as the accountant, have to show, it is advisable to plan ahead and perhaps submit books a little earlier than usual.
The ability to obtain a mortgage is getting much more difficult for those self-certifying their income, with the requirement for three years’ worth of accounts showing an upward trend being the norm. Just recently, we have seen a client who can only show two years’ successful accounts struggling to get the mortgage he needs with a lender with whom he has banked for years, despite having a good deposit. This situation is likely to become more commonplace, exacerbated in the case of the over 50s, who will potentially find it particularly difficult to gain approval from lenders.
Anyone interested in obtaining a guide to good book keeping, wanting further information on self-assessment tax return services or any other of the business support services offered by Adams Moore should call Tessa on 01827 54944.