Complex Income Mortgage

What is complex income?

Complex income is in the eye of the beholder, and could be anything that’s not a simple employed income – although some employed cases can even be considered complex at times. We’ll be covering the details later on.

What are the different types of complex income?

There can be lots of forms of complex income. It could be someone in a salaried job that does overtime and bank work or receives commission. Traditionally when people think of complex income, it might be a day rate contractor, a zero-hour contractor, a self-employed limited company director or someone with multiple revenue streams or even income from investments and pensions. There are lots of different ways we can look at it.

Why is complex income considered complex?

Anything that isn’t as straightforward as a simple salary can be complex. Lenders interpret other types of income in different ways, so it’s all about how it’s presented. For example, somebody might tell us they’re self-employed. Some lenders might use their salary and dividends as the income. Others might use salary and net profit – but if the client has a short-term contract, we could also use their day rate with some lenders. Different lenders’ approaches can lead to further complexities, especially when you’re not familiar with that. You might have heard you can borrow 4.5 or five times your income, but what is that income? What will lenders actually use? An advisor can portray that in the right way to suit the lender and your plans.

Can I get a mortgage with complex income?

Of course. Banks want to lend you money, and lots of people have incomes beyond a standard salary. It might just not be as simple as for somebody with a straightforward income. As a customer, you just want to find a solution. We take away that stress and complexity by finding the right lender and presenting you in the right way.

How much can I borrow with complex income?

The multiples are the same as usual. Some lenders will give you 4.5 times your income, some will go up to 5 and others may lend up to 5.5 or more. Where it can differ is in the income they use and how they calculate that. If you’re paid a bonus, for example, they might only accept 50% of it. Perhaps you have a new job and you were previously getting big bonuses, and the new job is in the same line of work. Some lenders will use your previous bonus towards a mortgage. This is where brokers become really important – because we can break it down and work out the most positive approach to achieve your desired borrowing.

Do I need a mortgage broker if I have a complex income?

You might not specifically need one, but I recommend it. Anyone looking for a mortgage should use a broker, because all the complexity sits on our side. You’re aware that your income isn’t straightforward, and you can let us take the complexity away. We ask questions and get the documents in to work out how to present that to the right lender. That’s where we show our value. We can then come back to you with a really good solution – even with a high street lender. They are often more than happy to look at that income and come back quickly with approval. We make sure it doesn’t feel complicated to you – we take that stress away and use our expertise to make it easier.

How do I find a mortgage broker who accepts complex income?

If you look online, you’ll get a good idea from reviews on how previous clients have found the process. If they’ve been supported the whole way through, that’s a good indication that they’ll make you feel at ease. If a broker can do that, the chances are that they will be good with the complex side. Pick up the phone and have a chat with one of the advisors. You might find they don’t quite know how to advise you and need to do some research, while another advisor could quite quickly break things down for you – that one is more likely to be familiar with complex income.

How does a mortgage broker that accepts complex income work?

It’s all about that knowledge. A mortgage broker should always be trying to get income proof documents quite early on. What somebody says they earn can in fact be different to a lender’s view of it. It’s better to get the documents, so we can present the correct information to an underwriter pre-application. Then, when we officially provide those documents with the full application, we know exactly how they will view them.

How long does a complex income mortgage application take?

It depends on the type of income and how quickly you can get us the documents. If we had a discussion today and got the documents the same day, our experienced advisors can get the case through quickly. We take your timescales into account. If we can place you with a high street lender or another bank that can move quickly, we will always do our best to do that and manage your expectations. If we need a more niche lender, it might take longer – perhaps four to five weeks for approval. Because we know how to structure cases with high street lenders we can get a complex income mortgage offer within a week or two – often even quicker than that.

Anything else to add?

Don’t assume that your complex income makes it too tricky to get a mortgage. Speak to a broker, and you’ll know quickly whether they can manage complex income mortgages. You’ll get a feeling for whether they know what they’re talking about and can give you confidence that what you’re looking to do is possible. If you can’t borrow quite enough, we’ll point you in the right direction and work on a plan with you. Don’t assume what you see on social media or hear from a friend is correct. Speak to a professional and get the right advice. There’s no cost for that. You won’t be wasting money trying to get something that isn’t possible, because there’s no fee for you to talk to one of our advisors here. So just pick up the phone. The worst outcome is that it’s not quite viable at this point in time. But the best case scenario is that you can get a mortgage you didn’t think was possible, which is fantastic.

Key Takeaways:

• Complex income is subjective and can include self-employment, multiple income streams (investments, businesses), maintenance, or benefits.
• Lenders assess complex incomes differently, making a broker valuable for packaging cases. Proof of income may require more than just payslips and bank statements.
• The primary documents for lenders are those showing taxable income, such as a tax calculation and tax year overview. Contracts, bank statements, or annual statements for pensions/benefits may also be required.
• Differences in interpretation between accountants, lenders, and customers can arise. Open and honest communication, along with providing the right documents, improves chances of approval.
• Smaller building societies are more likely to take a holistic view of complex incomes, often assessing them manually. Larger high street banks are more system-driven, making a personal approach beneficial for those who don’t fit standard criteria.
• Complex income is any income that is not a simple salary, such as earnings from overtime, commission, investments, pensions, or being a day rate contractor or self-employed limited company director.
• The complexity arises because different lenders interpret and calculate non-standard income in various ways – for instance, one might use salary and dividends while another uses salary and net profit.
• It is certainly possible to get a mortgage with complex income, as many people have incomes beyond a standard salary and banks want to lend money.
• Using a mortgage broker is highly recommended because they use their expertise to take away the stress and complexity, find the right lender, and present your income in the most positive approach to suit your plans.
• A knowledgeable broker can streamline the application process by checking income proof documents early, which can lead to a mortgage offer in as quickly as one or two weeks.

Your home may be repossessed if you do not keep up repayments on your mortgage.