Santander for Intermediaries will simplify its definition for customers where their business or income has been hit by Covid-19 from Monday (27 September), and has also updated its self-employed criteria.

The broker-only unit says it will consider an applicant as adversely affected by the pandemic where any of the three factors below apply:

A business that is not currently trading or has been re-opened for less than three months.

Where the business has taken a self-employment income support scheme grant, a job retention scheme grant (for limited companies) or bounce-back, bounce back loan scheme or Coronavirus business interruption loan scheme loans in the 12 months prior to the date of application.

And where staff have previously been furloughed due to business trading conditions in the 12 months prior to the date of application.

The government’s furlough scheme closes at the end of September, and the lender adds that all applications submitted from Monday will require standard income evidence requirements confirming the applicant has returned to work post-furlough.

The business adds that if a customer’s latest payslip shows furlough income, it will not use this income towards affordability.

The unit will also update its self-employed guidance on Monday.

It says that all self-employed residential applications are currently limited to 75% LTV.

For all self-employed income evidence, the most recent year-end must not be more than 18 months before the date of the application.

It explains that for applications submitted from Wednesday 6 October, the evidence of the most recent year-end can’t be for the 2019/2020 tax year, and the lender will need more up-to-date income evidence.