Santander Tightens Mortgage Lending for the Self-Employed

The impact of the pandemic on lending criteria continues to be felt by self-employed borrowers in particular with Santander limiting maximum loan-to-values (LTVs) for new residential applications to 60 per cent.

Self-employed applicants now require at least a 40 per cent deposit. The lender said this was to help manage current service levels following the latest lockdown and school closures and is intended as a temporary measure. Existing Santander customers who are self-employed and moving home or those taking out a buy-to-let mortgage will not be affected by the changes.

Santander also said that it will not lend to self-employed borrowers whose businesses are not trading as a result of Covid-19 restrictions.

Santander is not alone in imposing lending restrictions on self-employed borrowers. Nationwide has also reduced the maximum LTV for the self-employed to 85 per cent, even though it will lend up to 90 per cent for first-time buyers. Metro Bank is asking for more supporting evidence for the self-employed, including six months of bank statements, while businesses need to have been trading for at least three years.

While it is trickier for self-employed borrowers to get a mortgage, it is not necessarily impossible. Advice is more important than ever, which is where a whole-of-market broker such as AWS can help. We know which lenders consider self-employed applicants more favourably and can advise on the best lender for your circumstances. Get in touch for more information.
AWS Brochure

AWS Financial Services Helping Hand Brochure

Download

Case Studies

Day-Rate Contractor on a New Contract Buying their First Home

The pandemic has made life difficult for many borrowers and…...

Day-Rate Contractor with Relatively New Contract Buying a Home

Our client, a day-rate contractor, was only two months into…...

Life Insurance and Critical Illness Cover for a Day-Rate Contractor and his Partner

Our clients, in their mid-thirties, had recently taken on a…...