The Intermediary – March 2025 - Flipbook - Page 73
B RO K E R B U S I N E S S
Case clinic
level of works due to the one property being a
listed building.
BUCKINGHAMSHIRE BS
There would be two potential options. It could be
considered under a self-build renovation option, or
if the applicants were able to raise the funds via an
alternative source, maybe bridging.
The society could look to do a day one
remortgage once the renovation is completed and
signed off with building control.
WEST ONE LOANS
As one of the properties is listed, we would
need to see the approved planning permission.
Obtaining this can be a long process and can add
more expenses.
We would also need to know if the borrowers
are living in the residence during the work. If
the property is vacant, we would not be able to
approve a mortgage, but if they were to take out
a bridging loan with us, they could potentially exit
onto a residential mortgage.
We would also be able to look at consolidating
any renovation debt and working that into the
mortgage application.
HARPENDEN BUILDING SOCIETY
Our self-build products offer a great solution. We
can consider lending up to 75% of the current land
value (combined) plus build costs, enabling us to
access higher loan amounts where development is
taking place.
earned income, which their mortgage adviser
should retain proof of on file. For self-employed
customers, one year’s trading figures is sufficient.
We have simplified our affordability calculator
to focus on the keys to BTL affordability: rent,
property value, tax band. Cases are assessed on an
interest-only basis, which can be a win for those
choosing capital and interest. The adviser should
view the calculator outputs as an accurate guide.
BUCKINGHAMSHIRE BS
If it is a limited company where the applicants are
100% shareholders, the society can consider using
net profit plus director renumeration. We would
need to see a good track record of the company’s
performance, ideally three years. Company
accounts would need to be provided. Evidence on
the SA302 showing the dividends would also be
required as an average could be considered due to
the fluctuation.
TOGETHER
We have a flexible outlook on projected income,
so while we would review the income from the
previous two years via tax returns, we could also
use an accountant’s projection for the coming year.
This can be reviewed from day one of the new
tax year. If the borrower decided to hold back
some dividend payments for tax reasons, and if
this could be shown to be increased for the coming
year, including any projected increase in profits,
it could be used towards affordability. Together
could also look to utilise total secured debt to
income ratios to prop up any shortfall.
UNITED TRUST BANK
C AS E T H R E E
Expanding portfolio with
complex income
client earning £65,000 as a director of
their own company wants to purchase
a £350,000 BTL property. While their
company is profitable, they take a low base salary
and rely heavily on dividends, which fluctuate each
year, making affordability calculations difficult.
A
SANTANDER FOR
INTERMEDIARIES
Santander uses a simple measure to assess income
on BTL properties. Customers must have £25,000
UTB would consider this due to our no minimum
income BTL criteria. The applicant should be
able to evidence earnings through their limited
company, usually by way of their SA302s.
As we do not use earnings to support the
application affordability – it must pass on just the
rental income alone – the fluctuating income is not
a consideration when underwriting.
QUANTUM MORTGAGES
We do not require a minimum income and simply
need to be satisfied that the applicant has an
income to support their lifestyle.
HARPENDEN BS
As long as the business profits appear sustainable,
we can utilise either salary and dividends, or salary
plus share of net profit after tax, to meet the
£30,000 minimum income. ●
March 2025 | The Intermediary
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