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Santander amends self-employed mortgage income policy

  • 06/04/2022
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Santander amends self-employed mortgage income policy
Santander has updated its policy for self-employed mortgage borrowers when assessing income.


The bank will now take an average of the last two years’ income or the most recent year if this is lower. For existing borrowers moving home, Santander said its underwriters may be able to use a more individualised assessment. 

It previously asked for the last three years of income to calculate average turnover both during and before the pandemic. It also required statements within the last three months to show no government support had been taken.

The loan to value (LTV) limit of 75 per cent still applies for applications where any of the applicants are self-employed. This limit will not apply to existing borrowers who are moving home.

Santander is also changing its definition of a Covid-19 impacted self-employed borrower to now only capture details of outstanding support loans. Santander will remove its Covid-19 question and simply ask borrowers to confirm any outstanding loans. 

Businesses will no longer be grouped as Covid-impacted and non-Covid impacted.

Any undisclosed outstanding loans will lead to a declined application and any support payments will be counted as income.

Santander previously categorised self-employed applicants as adversely impacted by the pandemic if their business was not currently trading or had been re-opened for less than three months.   

Borrowers were also deemed to be impacted by the pandemic if they had taken a Self-Employment Income Support Scheme (SEISS) grant or if a limited company has received a Job Retention Scheme (JRS) grant. Additionally, those who had taken a bounce-back, Business Interruption Loan (BBIL) or Coronavirus Business Interruption Loan (CBIL) loans in the 12 months prior to the date of application would have been considered adversely affected by the health crisis.  

This definition also included self-employed managers whose staff had previously been furloughed due to business trading conditions in the 12 months before the date of application. 

These changes will apply from 11 April.

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