To think that claiming the SEISS grant has hindered my chance of getting a mortgage?

Ilovepearjuice · 2021-11-21T08:48:05+00:00

I'm self employed and hoping to buy my first property this year. I have a substantial deposit (potentially more than 50%) due to inheritance and other factors. However, I claimed three of the SEISS grants down to fear of losing work during various lockdowns. Although I lost out on some, turns out that my work was nowhere near as affected as I imagined (but I couldn't know that at time of claiming!). Therefore my earnings for 20/21 were still around the same as my 19/20 tax return. I'm terrified about the mortgage application process because I know that some companies are not accepting SEISS claimants. Even though, since January which was the last time I claimed, my trading is booming again! I just keep reading articles about people being turned down and it's scaring me. Are there any success stories out there? I'm meeting with a mortgage broker for the first time tomorrow, so I'm hoping I'll be pulled out of my doom and gloom. Thanks a million.

Frazzled2207 · 21/11/2021 08:57

Hi
I claimed Seiss and am also applying for mortgages soon.
Where have you seen info that this is a problem?

pilates · 21/11/2021 09:03

I hadn’t heard this.
We got a mortgage this year and my lender wasn’t interested in whether SEISS grants were obtained. Not sure if different lenders have different criteria though.

Rosemaryandlemon · 21/11/2021 09:05

So some mortgage companies won’t lend if you claimed SEISS (particularly three) as they say it shows concerns your business may be struggling.

Others though take it as income and not too worried.

Frankly lots of providers are being super cautious.

It’s always bit harder to get a mortgage when you are self-employed. I’m a barrister and my DH had to “buy” our first house as no one would give me a mortgage as I’d only been working 2 years (3 years later we remortgaged, I went on deeds and had to be pay CGT…)

Get yourself a good mortgage broker who specialises in self-employed people. My IFA is amazing. I found him through a builder friend who had an old CCJ and had struggled to get a mortgage.

Thinkling · 21/11/2021 09:07

We’re both self-employed and took the grants. We did eventually get a mortgage, but it was about £50k less than we’d originally been told and with a different company. The only way we could do it was having over 50% equity in our house.

Santander wouldn’t touch us, but we got one with Halifax in the end. It was a total nightmare and our mortgage in principle meant sweet FA.

Good luck!

MatildaIThink · 21/11/2021 09:07

Some lenders imposed blanket 12/24 month blocks for anyone who claimed SEISS, others will take a fuller view of tax returns, some lending based full amounts, others lending on earnings less SEISS.

As you are self employed make sure you go through a good independent broker, do not apply direct to a bank. The broker will be able to select the best lenders for your circumstances and will get you a better deal that you would get applying direct.

Bessiebigpants · 21/11/2021 09:09

We couldn’t get a joint mortgage having taken the Seiss grants this was back in April broker said loads of companies were not accepting them, We didn’t need much so we did it off my income in the end but very stressful but if you have been back trading and can evidence good income it should be okay apparently our issue was we applied as lock down ended so no evidence of income for probably a year!

Original poster

Ilovepearjuice · 21/11/2021 09:20

Thanks everyone. I don't know why I didn't mention it in OP, but DP is also self employed and claimed 4 grants (his income much more affected than mine!) so it's looking hard for us both when it comes to purchasing a property.

We have been recommended a good independent mortgage broker at least!

I'm quite angry really, because none of this was made clear when taking these grants, and I read up on the grants carefully before doing so. Both our businesses are back to full capacity and have been for quite a few months, so I don't see why looking back to the past is of any use. It should be the current earnings that count!

OP posts:

AntoinetteCosway · 21/11/2021 09:20

I took them and didn't have a problem getting a mortgage this summer - used a mortgage broker who knew which banks were ruling out applicants who'd taken SEISS payments.

Original poster

Ilovepearjuice · 21/11/2021 09:21

@pilates

I hadn’t heard this. We got a mortgage this year and my lender wasn’t interested in whether SEISS grants were obtained. Not sure if different lenders have different criteria though.

That's good news. May I ask who your lender was?

OP posts:

Original poster

Ilovepearjuice · 21/11/2021 09:23

@Thinkling

We’re both self-employed and took the grants. We did eventually get a mortgage, but it was about £50k less than we’d originally been told and with a different company. The only way we could do it was having over 50% equity in our house.

Santander wouldn’t touch us, but we got one with Halifax in the end. It was a total nightmare and our mortgage in principle meant sweet FA.

Good luck!

Thank you @thinkling - How long ago was this, if you don't mind me asking? I'm hoping it might have changed a little bit since then.

OP posts:

user1471539466 · 21/11/2021 09:26

My partner and I managed to get a mortgage with the Halifax. My partner took a few SEISS payments (I think he took 2 or 3) and I had been furloughed for 6 months last year too. We had no difficulties

Frazzled2207 · 21/11/2021 09:30

@Ilovepearjuice

Thanks everyone. I don't know why I didn't mention it in OP, but DP is also self employed and claimed 4 grants (his income much more affected than mine!) so it's looking hard for us both when it comes to purchasing a property.

We have been recommended a good independent mortgage broker at least!

I'm quite angry really, because none of this was made clear when taking these grants, and I read up on the grants carefully before doing so. Both our businesses are back to full capacity and have been for quite a few months, so I don't see why looking back to the past is of any use. It should be the current earnings that count!

Tbf to lenders they can be as picky as they want but you’re right it does seem wrong. If you can prove that your income wasn’t badly affected then I’d hope you will find a lender ok. Unless your dh’s income has also bounced back strongly I think that might be more of an issue, but not just because of the Seiss grants it’s always trickier for us self employed anyway, suggest using a broker so that you don’t waste your time with lenders who wrongly won’t touch you

fucketyfuckwit · 21/11/2021 09:31

Both me and DH are self employed and each took grants last year. We managed to do a simple re mortgage switch with Halifax to a new fixed rate but were told we weren't able to borrow extra.

We had been hoping for some extra to do an extension. We ended up fixing for just 2 years.

Luckily our businesses have survived and hopefully the interest rates aren't too high in 2 years time.

PurpleNebula84 · 21/11/2021 09:37

My ex had issues with being furloughed, but managed to get a mortgage with Barclays in the end.
He initially applied with Nationwide.

Original poster

Ilovepearjuice · 21/11/2021 09:43

Thank you everyone. The success stories are cheering me up! Us self employed make all the same contributions as employed, yet receive far less back. I find it so frustrating that things are so unnecessarily complicated for us, when there are more self employed people than ever!

OP posts:

SaltedCaramelHC · 21/11/2021 09:49

I'm wondering similar.

Also, if you took the grants, but your business wasn't as affected as you thought and your earnings were actually similar to the previous year, then doesn't your declared earning (including the grants) end up being massively more than previous years?

I"m kind of similar, as I was expecting my income to go up a lot in 2020, but I lost some work to the point that it was the same or slightly lower, but that still means my total income will look much higher, and I wonder if they will ask for the grants back as a result, claiming that I shouldn't have taken them.

thebellagio · 21/11/2021 09:52

We are both self employed and recently moved house with a new mortgage.

I wasn’t eligible for the grants as I was newly self employed (fuck you rishi), and my husband only took the first grant as after that, he was able to go back to work (he works outside).

We made sure we used a mortgage broker, but yes, some lenders are very sniffy about people who took the grants claiming that it shows your business isn’t secure (the fact many industries were legally mandated to shut down apparently doesn’t county!) we’ve gone with NatWest, they were the most flexible, others like Santander and Nationwide clearly have no interest in providing mortgages to the self employed.

You should be able to get a mortgage, but work with a broker. You may find that it’s better to go for a shorter term fix if you can’t get the best deal, just so you can change fairly quickly.

My mortgage broker told me that if you’ve been furloughed you need to provide three months of payslips on full pay to be able to get a mortgage. So they are flexible for the employed, yet not extending that same courtesy to the SE sector,

It’s ironic really. Because since being self employed for the last three years, (and six years for my DH), it’s probably the first time we’ve ever had job security. When your employed you could be sacked, made redundant at any point with little notice, yet being SE, you’re entirely in control over your earnings!

MatildaIThink · 21/11/2021 12:06

@Ilovepearjuice

Thanks everyone. I don't know why I didn't mention it in OP, but DP is also self employed and claimed 4 grants (his income much more affected than mine!) so it's looking hard for us both when it comes to purchasing a property.

We have been recommended a good independent mortgage broker at least!

I'm quite angry really, because none of this was made clear when taking these grants, and I read up on the grants carefully before doing so. Both our businesses are back to full capacity and have been for quite a few months, so I don't see why looking back to the past is of any use. It should be the current earnings that count!

Lenders always look back, it is why they need 2/3/4 years accounts and/or tax returns for the self employed or limited company directors. Your "current" earnings are too short a period especially in the ongoing economic climate.

I think it was fairly obvious there would be consequences, either from taking the grants or from the consequences of incomes dropping. The thing is it will not permanently mean you are unable to get a mortgage, it just means you will potentially need to wait a little longer, or borrow a bit less.

Any major economic disruption is always going to change lenders appetite for risk, this one is unfortunately no different.

pilates · 21/11/2021 13:53

We completed in June and went with Santander.

We did have a lot of equity approx 70% and my husband has been self employed for over 30 years which would probably make a difference.

DeepaBeesKit · 21/11/2021 14:04

Lenders always look back, it is why they need 2/3/4 years accounts and/or tax returns for the self employed or limited company directors. Your "current" earnings are too short a period especially in the ongoing economic climate.I think it was fairly obvious there would be consequences, either from taking the grants or from the consequences of incomes dropping. The thing is it will not permanently mean you are unable to get a mortgage, it just means you will potentially need to wait a little longer, or borrow a bit less. Any major economic disruption is always going to change lenders appetite for risk, this one is unfortunately no different.

This