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Getting a Mortgage After a SEISS Grant

See how expert advice could help secure your self employed mortgage

No impact on credit score

Pete Mugleston

Author: Pete Mugleston - Mortgage Advisor, MD

Updated: September 2, 2021

During the coronavirus pandemic, many self-employed people turned to the Self-Employment Income Support Scheme (SEISS) for help amid financial uncertainty. Although these government grants don’t directly impact your credit score, there have been reports of mortgage lenders being wary of customers who’ve taken one.

There’s a lot of misinformation and speculation around this topic, but if you’re a SEISS claimant who’s in the market for a mortgage, we’ve got good news: claiming one of these self-employment grants doesn’t mean a mortgage lender will decline you outright.

To dispel some of the myths around SEISS grants and mortgages, we’ve put together this handy guide to show how you can still get a mortgage.

Can you get a mortgage if you’ve claimed a SEISS grant?

Yes, but your choice of approachable mortgage lenders is likely to be fewer than it would be if you had continued trading uninterrupted throughout the COVID-19 pandemic. Some mortgage providers are wary of lending to anyone who has claimed SEISS support as it could be an indication that their employment is uncertain or that they’re struggling financially.

Since the SEISS grant is technically classed as income, some lenders won’t be too concerned that you’ve claimed one if you can prove that you’ve now returned to work and are making enough income to pass their affordability assessments. Other lenders are, however, placing extra scrutiny on SEISS claimants and are being more stringent with their checks.

Your chances of mortgage approval after claiming SEISS could hinge on which lender you approach. As we’ve just covered, some won’t see SEISS usage as an issue, others will proceed with caution and a handful might even reject you outright.

With this in mind, it’s vital that you find the right mortgage lender, one who would be willing to approve your application with minimal caveats and the best rates available, and this is something the expert advisors in our network can help you with.

We work with brokers who specialise in mortgages for self-employed people, and they know exactly which lenders will approve SEISS claimants and understand their needs.

How long should you wait before applying?

Most mortgage experts will tell you to wait until you’ve resumed trading for at least three months before applying for a mortgage. This is because there are lenders who are asking for evidence that the applicant has returned to business as usual since claiming SEISS support, and they will likely request at least three months’ business bank statement to prove this.

Although there are mortgage providers who aren’t being strict about this, your choice of approachable lenders will likely be higher if you were to wait until you’ve returned to a healthy trading level for at least three months before making an application.

Eligibility criteria

Anyone who’s claimed a SEISS grant will be assessed in line with the general mortgage criteria for self-employed applicants (assuming you haven’t started earning a PAYE salary since then), but some lenders are adding extra caveats to their eligibility criteria.

This criteria can vary from lender to lender, but below you’ll find a few examples of the extra things you might be asked for as someone who’s claimed SEISS…

  • At least three months’ bank statements to prove you’ve resumed trading
  • A full explanation of why you needed to take out the grant
  • To undergo extra underwriting checks
  • A copy of the approved grant detailing the amount and duration
  • A mortgage deposit that does not consist of SEISS funds

Some mortgage lenders are assessing applicants who have claimed SEISS on a case-by-case basis, so it can be difficult to judge whether you’re likely to be approved and what kind of rates you might get in advance. But a mortgage broker who specialises in complex applications from self-employed customers will know exactly which lender to approach.

Mortgage lenders who accept SEISS claimants

Mortgage lenders including Furness Building Society, Foundation Home Loans and Accord Mortgages will consider mortgage applications from customers who have used SEISS with minimal caveats, but other lenders will only do so with extra stipulations in place.

For example…

  • Post Office Money will need evidence that you’ve resumed trading and may ask for extra documentation to present to their underwriting team
  • Aldermore considers these applications on a case-by-case basis but doesn’t allow customers to use SEISS funds as a mortgage deposit
  • Vida Home Loans will request a copy of the approved grant and will consider SEISS claimants, but funds from the grant cannot be used for affordability
  • Santander will consider applicants but only if they are currently trading and it’s been at least three months since they last received a SEISS grant

Mortgage providers who won’t currently consider applications from SEISS claimants include Natwest, Precise Mortgages and Ipswich Building Society.

All of the above is merely a snapshot of the lenders who do and don’t consider mortgage applications from people who have claimed SEISS. Approaching a lender directly based on this information is not recommended as criteria can change at any time and most experts would suggest comparing the entire market before choosing a mortgage deal.

This is something a mortgage broker who specialises in self-employed customers can do for you. They have access to the entire market, deep working relationships with specialist lenders and the right knowledge and expertise to help you get the best deal and save you valuable time.

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Using SEISS income for a mortgage application

Finding a mortgage lender who will allow you to declare SEISS income and include it in the affordability assessment is difficult, as most mortgage providers will disregard it from their calculations when working out how much you could potentially borrow.

That said, there are a handful of mortgage lenders who will allow you to declare 100% of your SEISS income, along with the other declarable earnings evidenced in your accounts, under the right circumstances. It will help your cause if you’ve returned to business as usual since claiming your last grant and have at least three months’ trading history to back this up.

It’s a similar story if you want to use SEISS funds as part of your mortgage deposit. Some lenders won’t allow this, so your best bet is to seek professional advice from a broker who specialises in mortgages for the self-employed. With their knowledge of the market on your side, it may be possible to find a lender who will consider this deposit source.

Get matched with a self-employed mortgages expert today

If you’re applying for a mortgage after using the government’s SEISS initiative, there are extra pitfalls to consider and the chances of disappointment are higher. But, don’t worry, there’s a quick and easy way that you can boost your mortgage prospects.

We offer a free broker-matching service that will take your needs and circumstances into account to match you with your ideal mortgage advisor. This will be somebody who specialises in self-employed mortgage applicants and knows exactly which lenders are best positioned to offer the most favourable rates and deals to people who’ve claimed SEISS.

Finding the right mortgage broker for you could help you save time and money in the long run. Call 0808 189 2301 or make an enquiry and we set up a free, no-obligation chat between you and a fully-vetted advisor today.

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About the author

Pete, an expert in all things mortgages, cut his teeth right in the middle of the credit crunch. With plenty of people needing help and few mortgage providers lending, Pete found great success in going the extra mile to find mortgages for people whom many others considered lost causes. The experience he gained, coupled with his love of helping people reach their goals, led him to establish Online Mortgage Advisor, with one clear vision – to help as many customers as possible get the right advice, regardless of need or background.

Pete’s presence in the industry as the ‘go-to’ for specialist finance continues to grow, and he is regularly cited in and writes for both local and national press, as well as trade publications, with a regular column in Mortgage Introducer and being the exclusive mortgage expert for LOVEMoney. Pete also writes for OMA of course!

Read more about Pete

Pete Mugleston

Mortgage Advisor, MD

FCA disclaimer

*Based on our research, the content contained in this article is accurate as of the most recent time of writing. Lender criteria and policies change regularly so speak to one of the advisors we work with to confirm the most accurate up to date information. The information on the site is not tailored advice to each individual reader, and as such does not constitute financial advice. All advisors working with us are fully qualified to provide mortgage advice and work only for firms who are authorised and regulated by the Financial Conduct Authority. They will offer any advice specific to you and your needs.

Some types of buy to let mortgages are not regulated by the FCA. Think carefully before securing other debts against your home. As a mortgage is secured against your home, it may be repossessed if you do not keep up with repayments on your mortgage. Equity released from your home will also be secured against it.

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