Mortgages

(asked on 13th July 2020) - View Source

Question to the HM Treasury:

To ask Her Majesty's Government what action they will take to encourage mortgage lenders to reduce the proof of income burden on applicants who are self-employed.


Answered by
 Portrait
Lord Agnew of Oulton
This question was answered on 22nd July 2020

The proof of income information requirements from lenders for all mortgage applicants, including self-employed individuals, are commercial decisions and the Government does not seek to intervene.

However, the current FCA rules on how firms should assess the affordability of mortgages from applicants are deliberately framed to accommodate both salaried and self-employed borrowers.

New applicants will be asked to provide information on their income and expenditure, but FCA rules allow firms to decide for themselves how best they satisfy themselves regarding income information. FCA rules are not reliant on documents such as payslips, for example lenders could choose to use company accounts or projected business plans.

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