All lenders are set to be given powers to verify customers’ income with HM Revenue & Customs (HMRC) by the end of this year – with any mortgage application having the potential to be checked with the taxman.
The permanent link-up between lenders and HMRC, designed to help combat mortgage fraud, follows a pilot run of the scheme last year, where lenders who suspected income details on an application were fraudulent were able to check the details against information supplied to HMRC.
The Council of Mortgage Lenders (CML), which is leading the talks with HMRC, said it is keen for the scheme, which will be available to all lenders, to officially launch as soon as possible.
BestAdvice.net has been informed the service is expected to be live by Q4 this year, where it will be up to lenders’ fraud teams to refer the cases they suspect are fraudulent to HMRC.
However, the CML admits there is no hard line on what defines fraud, therefore lenders will have the discretion to decide what mortgage cases they want to check with HMRC.
Bernard Clarke, communications manager at the CML, said: “We won’t be seeking for definitions of what fraud is. Lenders will be able to check any case that they want to check.””
