Self Employed & Annual Bonuses

Why can now be a good time to apply for a mortgage?

April is the time of year where Tax Returns have been submitted and employees will receive their P60s. With all that in mind, now could be a good time to apply for a mortgage whether you’re a first time buyer or looking to move house.

With the latest copies of your tax returns available and your P60 presenting how much you earned in the last 12 months, these documents can be used as supporting documents for your mortgage application

Latest Tax Returns

Those who are self employed would have or will be receiving their annual tax returns. With your latest tax returns to hand, you will have proof of your income for the last 12 months. With this, a lender will be able to calculate a more accurate affordability check.

Bank of England

Do you receive an annual or quarterly bonus?

When you’re applying for a mortgage, you are going to most likely need to submit your latest three months of payslips. Your latest three payslips may not include a quarterly or annual bonus that you have received.

A P60 will present how much you were paid in the last 12 months and can be used as part of your mortgage application.

For example, if you’re looking to apply for a mortgage now (April) and received a large annual bonus in December, you will be requested to supply your last three months of payslips (April, March, February). Therefore, your annual bonus won’t be used as part of your affordability check.

However, submitting a P60 as a supporting document, it can take your bonus into consideration. This can result in you being able to lend more or lower monthly payments. 

Get in touch with our team

So with it being the start of the New Tax Year and the latest supporting documents becoming available, it could be a good time to look at your mortgage. If you wish to speak to one of our advisors about your mortgage needs, don’t hesitate to get in touch.

Call us on 01270 443510 or complete our contact form and a member of our team will be in touch whenever it’s best for you to discuss your residential or buy to let mortgage needs.

 

This blog is for general information only and does not constitute advice.