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SELF-EMPLOYED CRITERIA SHIFTS

From our April Ezine

We are pleased to see a positive shift in criteria on our lending panel relating to self-employed loans with lenders offering more helpful criteria.

We have seen more acceptance of one year trading to assess affordability alongside robust projections. This is a helpful acknowledgement that self-employed firms generally make losses or small profits in early years.

Lenders such as Saffron Building Society will allow net profit after tax, plus salary. Kensington will allow borrowers to use net profits if the client is 100% shareholder of the limited company, subject to accountant approval.

More lenders are looking at more complex incomes including contractor incomes, investment income, pension income as well as lending to age 85.