Latest tax demand note

As a tax demand note shows the amount of a person's income assessed by the Government, the bank normally accepts it as an accurate reflection of the borrower's earning capacity.

Bank book/statements showing salary income

The borrower's bank book(s)/statement(s) are required to assess the borrower's financial position. Bank statements will show the borrower's current income as well as outgoings, including any regular repayment obligations. Bank statements covering a certain period of time, say at least three months are usually required in order to ascertain the borrower's spending pattern as well as to prove that the borrower's income is stable.

If the bank discovers that the borrower is drawing a fixed amount of money out of his account every month, the bank may need to inquire whether the borrower is repaying other loan(s).

Employment contract/latest salary slip

The bank may want to obtain more information about the borrower's employment, such as the identity of his employer, job title, salary, employment terms, etc., and may require the borrower to produce his employment contract and latest salary slip to verify such information.

If the borrower is a sole proprietor or is engaged in a partnership, the business's accounts and tax demand notes (usually for the past three years) and bank statements are usually required.

Latest tax demand note

A company's tax demand note is always the first document a bank wants to obtain as proof of income. The bank may require the company's tax demand notes for the past three years in order to ascertain the level of profitability.

Audited financial statements/latest management accounts

The bank will usually require the company's audited financial statements for the past three years in order to ascertain its profits as well as its assets and liabilities. Sometimes the latest management accounts may also be required when the audited financial statements are not up to date.

Bank book/bank statements

The bank will also ask for the company's bank statements, covering, for example, the last six months, to review its income and expenditure and to verify the volume and turnover of the business. If the company borrower does not carry out any profitable business, the bank will require further or other assurances (such as a guarantee by a guarantor acceptable to the bank) before the mortgage loan can be approved.