FOR THE USE OF MORTGAGE INTERMEDIARIES AND OTHER PROFESSIONALS ONLY. HOW TO KEY INCOME

Transcription

1 FOR THE USE OF MORTGAGE INTERMEDIARIES AND OTHER PROFESSIONALS ONLY. HOW TO KEY INCOME

2 Income is used in the lending decision and it s important that it s keyed accurately. This guide will help you understand how to key income from self-employment, employment, retired/pension income and rent. Self-employed Select self-employed if the majority of the clients income is from self-employment. If the clients main source of income is from self-employment you must obtain the SA302 Tax Calculations for the last 2 years. We will only accept documentation no more than 18 months old. 1. From the clients Tax Calculation, TOTAL any profit from self-employment, dividends from UK companies, AND profit from UK land and property and input into the Self Employed income field. If the client has profit from UK land and property ALSO key this figure into the of which.is profit from UK Land and Property we need this in the total Self-employed income field AND the Profit from UK land and Property field. 2. If the client receives any other income from any source i.e. working tax credits (benefits) you must key in the additional income boxes. You will need to key 0 if the income box is not applicable. COOKIE POLICY Employment Details Mr Anish Krishna Navigate to... Application Home Check Save Previous Employment Type If you own 33% or more of the shares in your employer, please select Self-Employed from the Employment Status list. Employment Status Type of Employment Self-Employed Permanent Employer Details If the start date for your current employment is less than 2 years ago, we will ask for further information in the Previous Employment screen. Occupation Type Company/Employer Name Nature of Business Company/Employer Telephone Number Start Date of Employment or Contract (dd/mm/yyyy) Professional LBG IT 01/01/2001 Self-Employed Income Details If the applicant has more than one source of income, please ensure that the amounts are correctly allocated. Latest Year (yyyy) 2016 Self-Employed Income 00 of which 5000 Previous Year (yyyy) 2015 Self-Employed Income 8000 is profit from UK Land & Property 1 Additional Income Details You must declare all income the applicants receive including additional income. Maintenance Additional Job Retirement Pension Benefits Investment Income Trust Income 2 Gross Annual Rental Income Existing Buy To Let, Let to Buy, House 2 House and Consent to Let Properties (including this remortgage or additional borrowing if applicable). Customer s share of total GROSS annual rent from all properties Point 3 follows on page 3 2

3 3. If the client has any EXISTING Buy to Lets you must key the Gross annual rental income. The GROSS income is the monthly rent x12. Only key the client s share for example - joint application, 0 per month joint existing Buy to Let, key 6000 per applicant. ONLY key existing Buy to Lets in the background, including the subject property if a remortgage (excluding Let to Buy property). Example Clients only income is from rental property, 2,000 gross per month, 12,000 declared as profit from UK Land & Property to HMRC. Key as follows; Self-employed Income = 12,000 Of which 12,000 is profit from UK land and property Gross annual rental income = 24,000 Employed Select Employed if the majority of the clients income is from employment. 1. If the clients main source of income is from PAYE employment you must obtain the latest pay slip. Key in the annual total gross basic income. If the client receives other income from this employment key the annual amounts using an average of the last 3 months. 2. If the client has self-employed income, including profit from UK land and property, declare the SA302 tax calculation amounts in the additional income. Profit from UK land and property must also be declared separately in the of which... is profit from UK land and Property. 3. If the client receives any other income from any source you must key in the additional income boxes. You will need to key 0 if the income box is not applicable. Point 4 together with an example follows on page 4 3

4 COOKIE POLICY Employment Details Mr Anish Krishna Navigate to... Application Home Check Save Previous Employment Type If you own 33% or more of the shares in your employer, please select Self-Employed from the Employment Status list. Employment Status Type of Employment Employed Permanent Employer Details If the start date for your current employment is less than 12 months ago, we will ask for further information in the Previous Employment screen. Occupation Type Job Title Company/Employer Name Nature of Business Professional Technical Lead LBG IT Company/Employer Telephone Number Payroll Number Start Date of Employment or Contract (dd/mm/yyyy) 01/01/2001 Employed Income Details If the applicant has more than one source of income, please ensure that the amounts are correctly allocated. Basic Income Overtime Bonus Commission Additional Income Details You must declare all income the applicants receive including additional income. 1 2 Income from Self-Employment 00 of which 5000 is profit from UK Land & Property Maintenance Additional Duty Hours Investment Income Nursing Banks Benefits Additional Job Mortgage Subsidy Retirement Pension 3 Shift Allowance Town, Area or Car Allowance Trust Income Gross Annual Rental Income Existing Buy To Let, Let to Buy, House 2 House and Consent to Let Properties (including this remortgage or additional borrowing if applicable). Customer s share of total GROSS annual rent from all properties If the client has any EXISTING Buy to Lets you must key the Gross annual rental income. The GROSS income is the monthly rent x12. Only key the clients s share for example - joint application, 0 per month joint existing Buy to Let, key 6000 per applicant. ONLY key existing Buy to Lets in the background, including the subject property if a remortgage (excluding Let to Buy property). Example Client is employed on 20,000 basic, 10,000 overtime, Self-employment 2,000, income from rental property 2000 gross per month, 12,000 declared as profit from UK Land & Property to HMRC. Key as follows; Basic Income = 20,000 Overtime = 10,000 Income from Self-Employment = 14,000 Of which 12,000 is profit from UK land and property Gross annual rental income = 24,000 4

5 Retired/Pension income Select Retired if the majority of the clients income is from pensions. 1. If the clients main source of income is from Pension you must obtain the latest monthly bank statement or latest annual pension statement. Key in the annual total retirement income. 2. If the client has self-employed income, including profit from UK land and property, declare the SA302 tax calculation amounts in the additional income. Profit from UK land and property must also be declared separately in the of which... is profit from UK land and Property. 3. If the client receives any other income from any source you must key in the additional income boxes. You will need to key 0 if the income box is not applicable. COOKIE POLICY Employment Details Mr Anish Krishna Navigate to... Application Home Check Save Previous Employment Type If you own 33% or more of the shares in your employer, please select Self-Employed from the Employment Status list. Employment Status Type of Employment Retired Not Applicable Retired Income Details Source of Income (Main Pension) Income (per annum) Retirement Pension Additional Income Details You must declare all income the applicants receive including additional income. Income from Self-Employment 00 of which is profit from UK Land & Property 2 Maintenance Benefits Additional Job Trust Income Investment Income 3 Gross Annual Rental Income Existing Buy To Let, Let to Buy, House 2 House and Consent to Let Properties (including this remortgage or additional borrowing if applicable). Customer s share of total GROSS annual rent from all properties If the client has any EXISTING Buy to Lets you must key the Gross annual rental income. The GROSS income is the monthly rent x12. Only key the clients share for example - joint application, 0 per month joint existing Buy to Let, key 6000 per applicant. ONLY key existing Buy to Lets in the background, including the subject property if a remortgage (excluding Let to Buy property). Example follows on page 6 5

6 Example Client is retired on 20,000 pension, 2,000 additional job, Income from Self-Employment 2,000, income from rental property 2000 gross per month, 12,000 declared as profit from UK Land & Property to HMRC. Key as follows: Pension income = 20,000 Additional job = 2,000 Income from Self-Employment = 14,000 Of which 12,000 is profit from UK land and property Gross Annual Rental Income = 24,000 Household income For creditworthiness purposes we need to ensure the client can afford their current financial commitments. Input the total monthly mortgage payment for all residential mortgages the client is party to. Then key the total annual household income for all parties named on all of the declared residential mortgages, even if they are not party to this Buy to Let application. Financial Commitment Details How much do you typically pay towards your financial commitments each month? Please enter a total figure for all applicants The figure should include; unsecured personal loans that have more than 3 months to run (e.g. car loans, HP Agreements etc), 5% of credit card/store card balances that are not cleared on a monthly basis, monthly payment re charge card/budget accounts. This figure should exclude; household utility bills, child maintenance, payments into savings/investment plans. Monthly Payment Amount Total Balance Outstanding Are you repaying some or all of these commitments upon Yes No or prior to completion of this mortgage? Balance To Be Repaid Monthly Saving The monthly saving figure should be based on the amount that will be saved each month after the settlement of any unsecured loans and 5% of the reduction in any credit card/store card balances. Do you have any residential mortgages? Including holiday homes, Yes No second home loans or dependent relative homes. Excluding Consent to let, House 2 House and Holiday lets What are the monthly mortgage payments for all residential mortgages? What is the annual household income of all parties named on the residential mortgages? Please enter details of other regular committed expenditure Total monthly amount of any additional commitments for the first two applicants (maintenance, student loan, rent, childcare, school/ university fees, leasehold ground rent/service charge or other committed expenditure) 6

7 Current achieved/anticipated monthly rent and selected product rate For re-mortgage, further advance and purchase of equity applications key current achieved monthly rent. For purchase and Let to buy applications key the anticipated monthly rent. At decision in principle stage we now require you to select a product rate. This selected product rate can affect borrowing levels so it is important that you select a rate from our current product range and input correctly. Loan Details Repayment Amount Interest Only Amount Purchase Price of the Property Provide current achieved monthly rent (remortgage, further advance and purchase of equity applications) or anticipated monthly rent (purchase and let to buy applications) of the property in question Loan Term in Years Selected product rate (please choose from current product range) Note: If the selected product rate changes during the application process this may affect the amount we can lend Summary Below is a summary of the loan details. Please use the Calculate button to check these are correct. If you want to change anything, you can easily re-check the values by using the Calculate button. Total Loan Amount Requested 5655 Current LTV 56.55% Calculate 7

8 Selecting product rate at illustration If you change the selected product rate at illustration stage the level of borrowing may change. If you need to choose a different product rate to the one selected at DIP stage, use the BM Solutions online rental calculator to check if the borrowing amount is affected. If the level of borrowing is unaffected continue to select a different product. Product Selection Cancel Check Previous Products Available Note:- If the selected product rate changes during the application process this may affect the amount we can lend. If you need to change the product rate please visit our website for further guidance. For loans lower than the original Decision in Principle please amend on previous loan details screen before selecting product. We currently have a total of 19 products available. Product Exclusive Max. Amount Select Please click on a product name to display further information. NIJ - BTL Gen 5.40% Fixed to 31/08/ % LTV 125% PR 65, NIK - BTL Gen 5.55% Fixed to 31/08/ % LTV 125% PR 65, NIN - BTL Gen 5.04% Fixed to 31/08/ % LTV 125% PR 65, NIP - BTL Gen 4.19% Fixed to 31/08/ % LTV 125% PR 65, NIQ - BTL Gen 4.34% Fixed to 31/08/ % LTV 125% PR 65, NIR - BTL Gen 4.99% Fixed to 31/08/ % LTV 125% PR 65, NIS - BTL Gen 5.14% Fixed to 31/08/ % LTV 125% PR 65, Exclusive Product Search If you wish to include an Exclusive or Semi-Exclusive product, enter the product code and click Add. Add If the level of borrowing available has increased but the client is happy to proceed with the loan originally requested at dip stage then continue with your change of product. If the level of borrowing available has increased and the client would like a higher level of borrowing, rekey the application at the higher amount selecting the correct product rate. (Please call the service team to cancel this case before you rekey). If the level of borrowing available has reduced and the client wants to continue with the lower level of borrowing, allocate the reduced loan amount to the new product, adjusting the purpose of loan as required, and continue with the reduced loan amount warning if you fail to do this the application may be delayed and you will be contacted by BM Solutions Processing team to reduce the loan amount after full submission. 8

9 GET IN TOUCH For more information, speak to your Business Development Manager or visit bmsolutions.co.uk If you do not have professional experience, you should not rely on the information contained in this communication, if you are a professional and you reproduce any part of the information contained in this communication, to be used with or to advise private clients, you must ensure it conforms to the Financial Conduct Authority advising and selling rules. Birmingham Midshires is a division of Bank of Scotland plc. Registered in Scotland No. SC Registered Office: The Mound, Edinburgh, EH1 1YZ /17