Complex Income Mortgage

What challenges might arise during the mortgage application process when declaring complex income?

Even with the simplest of cases, lenders can often have questions. They might look at a bank statement and want to know more about your spending.

If we then add in a layer of complexity, there may well be additional questions. Remember, the lender doesn’t know you – so it’s our job to put your situation to them in the best possible way.

We try to preempt their questions and get those answered at the point of application. Inevitably, there will be things a lender’s not sure about. The other week, we had a client who had received some money from We Buy Any Car. The lender had questions about it – even though we felt it was fairly obvious where that had come from.

It’s our job to fend those questions off and answer them on your behalf. We do that as much as possible.

How do I improve my chances of getting approved for a mortgage with complex income?

Preparation is key. That means having all the documents and information, and not holding back from your mortgage broker.

Some people think they need to be a bit careful about what they say to us – in fact, it’s the opposite. You need to tell us everything, and we will pass on to the lender what they need to know.

We’ve been doing this a long time – we know what lenders need to know and what’s not relevant. Give us all the facts, and we’ll translate that into the right information for the lender.

As always, make sure your credit score is OK and gather your bank statements – all the normal things.

Are there any mortgage lenders that specialise in offering mortgages to customers or clients with complex income?

Some high street lenders will look at slightly more complex cases, and other, smaller lenders can be better set up to look at things individually. Some lenders will consider everything case by case.

Many big lenders use AI or computer systems to check your payslips against the application form, and then an offer comes out at the other end. Sometimes that can be done in a matter of moments.

With other cases, a person needs to look at it, which can potentially take days or weeks. It completely depends on your situation. There are some types of income that I can take to certain high street lenders.

I had a recent client with five different companies. Whilst it looked complex on the surface, we broke it all down and had all the relevant proofs and documents. In the end, it wasn’t that complicated, and we placed it with a major bank.

How can I calculate my borrowing capacity when I have complex income? Does it differ from regular income?

It depends on how your income is made up. I’ll calculate your borrowing capacity once I know all about your income.

You might not be able to use every source of income, and you might assume you can’t use other types, when in fact you can. Most lenders’ calculators simply ask for your income and whether you’re employed or self-employed. Some might allow for bonuses and overtime, but they aren’t set up for multiple options.

With complex income, you will need a mortgage broker to work out what’s possible. You’re unlikely to find the results online.

What else do we need to know about getting a mortgage with complex income?

We’ve covered the basics. If you’re Mr and Mrs Average, with a simple income, Google or ChatGPT could probably point you in the right direction. But when you add in an element of complexity, AI won’t know that lenders can do certain things, as that won’t necessarily be published.

We talk to lenders all the time. One told us this week that if a client wants to borrow over a certain amount, they can completely ignore their criteria. We just need to discuss it with them – and that’s a massive mainstream lender. Banks wouldn’t publicise that, but they can be flexible depending on the case.

Key Takeaways:

• Complex income in the UK can include diverse sources such as a limited company director’s salary and dividends, sporadic bonuses or commission, income from multiple jobs or companies, and earnings from employment, shares, and investments.
• Most typical high street lenders are not set up to handle complex income, meaning applicants should seek smaller lenders or those with specific departments who can assess cases individually.
• Proving complex income requires providing a complete paper trail for all elements and demonstrating a track history; this may mean needing a few years’ records, as lenders prioritise the applicant’s future repayment ability.
• To improve approval chances, preparation is key, which involves having all documents ready and disclosing all facts and information to your mortgage broker, who will then translate the necessary details to the lender.
• A mortgage broker is essential because they know what is possible and can calculate your borrowing capacity, which is unlikely to be accurately determined using standard online lender calculators.
  
  

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