The future is looking positive and we’re finally leaving Covid restrictions behind, however if you’ve taken Government support, you might be left with questions around obtaining a new mortgage and remortgaging.
Andrew Hardcastle, one of our Mortgage & Protection Specialists has received a lot of enquiries from clients that accessed the Self-Employed Income Support Scheme (SEISS) or who’ve taken a mortgage payment holiday. There’s an understandable level of concern regarding whether either type of help will have any bearing on lending decisions for the future. If you’re in this position, you might be left wondering if you’ve ‘shot yourself in the foot’ by taking the financial help that was needed at the time.
When it comes to payment holidays, all this means in real terms is that you’ve taken a three-month break in your payment schedule. This is not considered as a default or non-payment and is simply added onto the end of the mortgage term, making your total mortgage period three months longer.
You might have been in this situation and keen to understand if you need to stay with their current lender or if they are able to go elsewhere. Andrew says: “The key thing to be aware of here is that just because your current lender has granted you a payment holiday does not mean you are obliged to stay with them moving forward.
You can look elsewhere when it comes to remortgaging and not experience repercussions from your payment holiday”.
SEISS: Avoid over-inflating your books
Many self-employed individuals who have taken advantage of the SEISS are in a situation where if they add the income received from the grants to their 2020-2021 books, it can appear that they have had a much more profitable year than they actually did. This is not looked upon favourably by prospective lenders as it can look like businesses are inflating their books using the government schemes. Andrew says: “It’s best to use a mortgage broker to work on your behalf and demonstrate to lenders the true picture of your current financial situation. In some scenarios, lenders will actually write off the 2020-2021 figures as they can be so skewed, especially when financial assistance from the SEISS is factored in”.
Work with the experts
Using an expert broker will ultimately save you money as it will ensure you get access to the very best deals for you. Andrew concludes: “We have access to bespoke lending panels where we can work with experts in the field to help us get mortgages approved and decisions made that would have otherwise been rejected if the application went through the traditional online process.
Tudor can help you to demonstrate the viability of your business to lenders by delivering a true understanding of its financial health, which will ultimately help to sway decisions”.
When it comes to mortgages, the outlook for those who have used the SEISS or payment holidays is ultimately very positive. It’s also important that you work with the experts to help you get the best outcome possible.
If you’d like to discuss your personal situation with Andrew and the team in more detail, get in touch to book an appointment