Insight and events

The trials and tribulations of complex income

Roger Morris, Group Distribution Director – Kent Reliance for Intermediaries

Imagine a customer approaches you looking for help securing a residential loan: Stephanie – a thirtysomething, self-employed contractor working in advertising who, despite the challenges thrown at them by COVID-19, has managed to continue working through the pandemic.

However, the inconsistent nature of her work and her fluctuating income proves to be a challenge in helping her get a loan. So, how can you, as a broker, provide the support she needs?

The COVID-19 pandemic has brought many challenges and changes to the housing market. Most notably is the sustained activity following the introduction of the Stamp Duty holiday, which has led to the average UK house price rising to a record high of £254,606¹.

Unfortunately, for some, this makes the prospect of taking that next step on the property ladder, or even getting a foot on the lowest rung, all the more challenging. But for contractors and self-employed workers supporting themselves and receiving inconsistent income, this becomes a bigger mountain to climb.

However, despite the challenges that those with complex income have faced, there’s still a large number of individuals working for themselves, which means the need for specialist lenders to support these prospective buyers remains more important than ever.

But it’s not just lenders that play an important role.

Brokers… know your worth!

If you’re a broker who regularly deals with complex income cases, you no doubt understand the difficulties your self-employed and contractor clients are up against.

But how exactly can you support those who need it most?

Well, I’d encourage you to recognise your importance as a broker. Remember, you play an important role when it comes to supporting applicants with inconsistent or unconventional income.

Buyers with varied income will often go to a broker as their first port of call, aware that their situation needs the support of an expert. They’ll depend on your understanding of the market, knowing your support could be the best chance of them being approved for a loan.

Of course, this puts pressure on you, and knowing where to turn can seem a bit daunting at times. However, I can’t stress enough that it all comes down to having good relationships with experienced lenders and knowing how well-positioned each lender is to support a client’s specific circumstances – however challenging or straightforward they may be.

Our complex income solutions

In these situations, lenders like Kent Reliance for Intermediaries understand the importance of not having a one-size-fits-all approach, which is essential for clients with complex income. Our flexibility and willingness to lend provides opportunities for clients struggling to get a loan due to their financial situation. We look at each case in detail to view the full story, and work personally with brokers to find the best possible solution.

We accept individuals that have been self-employed for a minimum of 12 months, providing proof of income is supplied. This should be based on the finalised accounts, accountant’s reference or any tax calculations submitted to HMRC.

We can consider applications for contractors, as long as applicants can evidence at least one contract renewal, with a minimum of 12 months of sector experience. We can also accept those on a PAYE contract basis, providing their contract has been renewed at least once, with at least six months to run. Most importantly, there’s no minimum income requirement for contractors.

However, I firmly believe that criteria is only the starting point of a conversation. With our flexible underwriting and individual case assessments, we’re happy to consider your cases – even if they don’t quite fit our criteria – so please get in touch.

Chat to us today

You have the power to support clients with complex income, but if you need help with a challenging case, we can work with you to find the necessary solution.

You can get instant answers to your case queries when using Live Chat on our website. This is a direct link to our talented broker liaison team who, with their detailed product knowledge, are able to advice you on your complex cases. Plus, you can also call 01634 888260 to speak with them in person about your cases.

Don’t forget to speak to your local business development manager, who has the relevant market knowledge and experience to support your most challenging cases.

¹ https://www.mortgageintroducer.com/halifax-house-prices-at-record-high-as-momentum-increases-in-march/