Independent employees who apply for a mortgage in the coming months will be reminded of submitting their tax returns very soon to meet the requirements of lenders.
L&C Mortgages has issued the warning before October 6 – a crucial date for anyone who completes a tax return and obtains a mortgage.
But why is the date considerable? The mortgage broker explained that lenders usually want to see two years of income record to prove the income of the self -employed.
Although the tax return for the tax year ending in April 2025 does not have to be submitted to HMRC until the end of January 2026, mortgage providers expect that the end of the most recent year will not be more than 18 months before the application.
This means that many lenders will no longer be able to accept the last proof of income from the tax year 2023/24 for applications received after 5 October.
David Hollingworth, associated director at L&C Mortgages, said: “It could come as an annoying surprise for any independent borrowers who are not aware of this requirement. Since the timeline lasts 18 months, those who apply for a new mortgage could find that they should hurry to meet the requirements of the creditor.
“That can cause a delay that would be particularly undesirable for those who want to move home, but can also influence that remort of the remingage to a better deal. It is worth looking ahead if your deal ends quickly and submit your return, so that it can ensure a smoother mortgage trip.”
L&C has answered some common questions to help Independent employees Who are about to take the leap and buy a house.
Can I get a standard mortgage agreement?
Hollingworth said: “Some may think they can’t get a mainstream mortgage, but that is not the case.
“As long as the income certificate is there, High Street -money lenders will offer the same deals as they are offered to employees.”
What if I don’t have two years of accounts or self -evaluation?
Most lenders usually want to see a two -year track record to support the income level, explains Hollingworth. “That can make it harder for those who have been more self -employed, but some lenders may consider a year in the right circumstances, so take advice.”
Why do money lenders want two years of accounts?
Hollingworth explained, being able to fluctuate independent income from one year to the following, in contrast to that of employees with a basic salary.
“Lenders therefore want to see that there is a better chance of consistent income on which they can base their affordability assessment,” he added. “If there are large fluctuation lenders to understand why they help to make the mortgage decision.”