Self Employed Income Support Scheme
If we cast our minds back to 2020, it was obviously a difficult time for everyone. But being self-employed was particularly unnerving. We didn’t know if work would still come in, but also, could we actually do the work if it did? Were we allowed to be working within the restrictions that had been placed upon us all? Depending on your industry, it was a tough time.
Because of this, the government introduced the Self Employed Income Support Scheme (SEISS). It was essentially the furlough scheme for the self-employed. However, not everyone was eligible, which was frustrating. Those that were, could receive a percentage of their monthly trading profits, at different points throughout the year.
As with everything during the pandemic, times were unprecedented, and people had to react to situations without knowing what was going to happen in the future. Getting a mortgage when self-employed became a little tougher, as lenders were deciding how best to proceed with applications.
Thankfully, now restrictions have eased, and we get back to our ‘new normal’, many lenders now understand the reasons why a SEISS grant was taken. They will make sure that it doesn’t adversely affect you, when applying for a mortgage.
Having said that, there are still lenders which may deduct SEISS grants from your income, which will reduce your borrowing capacity. They could take your net profit for that particular tax year, and deduct the value of grants. Of course, that then reduces your overall income.
If you have had a SEISS grant, then it makes sense to use a lender that won’t take the amount from your overall profits, and understands the reasons for taking it in the first place.
Your best course of action is to speak to a specialist advisor, who has been through the last 2 years, working with lenders and self-employed applicants together. We know which lenders will work best in your situation, and will make sure to avoid the ones that won’t.