Self-employed borrowers urged to talk to their accountant at a 'very early stage'




In a recent webinar on the impact Covid-19 has had on the self-employed, Jonathan Bregman, managing director at JD Bregman & Co, stated that borrowers need to be speaking to their accountant at a "very early stage" to give them the best chance of success when looking to secure finance.

B&C — which chaired the event — asked Jonathan (featured in the video, above) how accountants could help self-employed borrowers, whether it was for a BTL, commercial loan, or a mortgage. 

“Clients need to be talking to the accountant about what they are thinking, ‘I want to move home, I want to buy a BTL,’ and we can then start to talk about the information that we will need to generate with them for the lender,” he answered.

“There’s a responsibility from the client to be talking to the accountant at a very early stage.”

He explained that accountants will then need to bridge the gap with a package of information lenders will now be looking to receive to support the application.

“It’s no longer the last two- or three-years’ tax returns, the last two- or three-years’ accounts — that’s a given,” he added.

“A lot of owner-managed businesses, self-employed people, will not be working with technology, in terms of the likes of Sage, Xero [and] QuickBooks” he pointed out.

“If we can get people onto a technological platform, then we can help to project the future and what the next 12-24 months looks like by using other integrated packages that work with the likes of Xero, QuickBooks and Sage, to produce a forecast that has sensitivities in it as well.

“…The key here is for us to make lives easier for the underwriter, so that the questions that come back are limited, and we can do that by bridging the gap by speaking to the client, saying, ‘This is what you need to give us, this is the ammunition that we need,’ and then by speaking to the lender, we will understand how we can package this up to give them the best chances of success, and also cut down the time and inefficiencies in the process.”

Alistair Hargreaves, financial consultant at Arc & Co, said it was focusing on core activities that drive the application forward.

“Where a broker comes into this, is providing excellent packaging,” he said.

“…Brokers need to educate clients and say, ‘I know you want to move forward as quickly as possible and we need this offer out fast, but [what] I need from you [is] this long list of things and, if I haven’t got this, I’m not going to submit it, because it’s just going to delay.’”

Sending all the information needed will likely result in a more positive and quick response from the underwriter.

He further explained that a scenario to avoid is missing a key document at the start which could negate the whole process later on. 

Part two of the webinar — which was chaired by B&C editor, Beth Fisher, and included Stephen Barringer, head of mortgages at Market Harborough Building Society and Matt McCullough, national sales manager of intermediary mortgage distribution at Aldermore — can be viewed in full, below.

The first part of the webinar, which was published last week and discussed why now is the “perfect” time for brokers to stand out as self-employed borrowers face rising costs and delays, can be viewed on B&C.

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