View more on these topics

HMRC checks could cause problems for self-employed

A specialist mortgage broker has warned that self-employed and contract workers may encounter problems when applying for a mortgage directly, as a result of the mortgage verification scheme.

The scheme was launched last September by HM Revenue & Customs, the Council of Mortgage Lenders and the Building Societies Association to tackle fraud. If a mortgage lender suspects an applicant of supplying a false income, they can cross reference it with HMRC for a £14 fee.

HMRC will check applicants’ income details against their income tax and employment returns.

But Tony Harris, managing director of ContractorMoney, which works on behalf of short-term contract workers and self-employed people, says that if borrowers have put their gross contract rate on an application with a lender, it will not tally with HMRC figures.

The HMRC figure is likely to be different because the applicant will not pay personal tax on such job-related spends as accountant fees.

Harris says: “I foresee problems where borrowers go to a lender direct because they won’t always have the knowledge to present their case in the best light, which in turn will make the underwriters more inclined to consult HMRC under this verification initiative.”

He says brokers can ensure that the application goes to a key individual at the lender with whom they have already discussed the particulars of the case.

But a spokesman for the CML says: “If people report the same figure to HMRC as they report to the lender the scheme should not create any problems for them.”



Halifax gives you extra with SVR cap

Halifax’s change to its SVR cap certainly puts a whole new meaning to its catch phrase ’the bank that gives you extra’ – but extra is not always good.

Co-op gives reassurance over future of Platform

The bank is closing Platform’s London office in Canary Wharf and relocating the departments to other locations, mainly Manchester. A spokesman for the Co-operative Bank says it remains committed to its Platform brand and plans to increase lending in this market, especially through buy-to-let. He says: “While the mortgage market remains challenging we regularly review […]


Guide: 10 required letters — what to send, to whom and when?

This guide from Johnson Fleming will take you through the required communication and also give ideas for additional actions that will ensure your auto-enrolment project is a success. The topics in this guide include: the letters you need to send out; what to send and when; the importance of employee engagement; and what to consider as additional communication.


News and expert analysis straight to your inbox

Sign up

Why register with Mortgage Strategy?

Mortgage Strategy continues to be the market-leading B2B mortgage publication in the UK, and provides trusted, independent insight with the aim of helping, promoting and analysing the latest developments for mortgage professionals.

News & analysis delivered directly to your inbox
Register today to receive our range of news alerts including daily and weekly briefings

Mortgage Strategy Events
Be the first to hear about our industry leading conferences, awards, webinars and more.

Research and insight
Take part in and see the results of Mortgage Strategy's flagship investigations into industry trends.

Have your say
Only registered users can post comments. As the voice of the adviser community, our content generates robust debate. Sign up today and make your voice heard.

Register now