Mortgage Application for Director with 2 years income help
Discussion
Hi hope some one can help
my wife and i are racking our brains currently, will be applying for a mortgage over the next few weeks, we are both majority share holders in our limited company and both bring money into the company, we want to be in the best possible postion before the application
we have 2 years books
the 2nd years income was solely via the limited company
the company was created while i was still in full time employment (dec2012)
the 1st year was made up of MY salary via full time employment from jan13 - feb13 and then solely via the limited company from feb13-dec13
my Wifes had a similar 1st year her salary was via full time employment from jan13 to oct13 then solely via our limited company oct13-dec13 ( she also took her dividend share along side her full time employment salary)
question is will the mortgage application take both into account as income or will they solely look at the limited company income, that being the case i am looking a decent chunk of already TAXED income not being utilized
any help will do, as said the first port of call (mortgage advisor) have told us to just come in and apply, but id rather be ready for the worst
my wife and i are racking our brains currently, will be applying for a mortgage over the next few weeks, we are both majority share holders in our limited company and both bring money into the company, we want to be in the best possible postion before the application
we have 2 years books
the 2nd years income was solely via the limited company
the company was created while i was still in full time employment (dec2012)
the 1st year was made up of MY salary via full time employment from jan13 - feb13 and then solely via the limited company from feb13-dec13
my Wifes had a similar 1st year her salary was via full time employment from jan13 to oct13 then solely via our limited company oct13-dec13 ( she also took her dividend share along side her full time employment salary)
question is will the mortgage application take both into account as income or will they solely look at the limited company income, that being the case i am looking a decent chunk of already TAXED income not being utilized
any help will do, as said the first port of call (mortgage advisor) have told us to just come in and apply, but id rather be ready for the worst
Edited by big_peaches on Tuesday 6th January 07:35
I can tell you now (as a Mortgage Broker!) you cannot use income that is no longer relevant to you. A lender isn't going to take income from previous employment.
If you remained PAYE and changed jobs, a lender isn't going to take your previous salary into account as it bears no relevance to your current circumstances. This is the same, just that you have gone from employed to self employed. Assuming your sole employment is now from your Ltd company then that's the income they are going to assess.
You need to look at the income you have drawn from the Ltd company (usually in the form of salary & dividends)as this is what they are going to ask you for and base their decision on.
Any mortgage advisor at a bank is always just going to tell you to "come in and apply", that's their job, to get you into the branch even if they know already that they are unlikely to lend to you.....
If you remained PAYE and changed jobs, a lender isn't going to take your previous salary into account as it bears no relevance to your current circumstances. This is the same, just that you have gone from employed to self employed. Assuming your sole employment is now from your Ltd company then that's the income they are going to assess.
You need to look at the income you have drawn from the Ltd company (usually in the form of salary & dividends)as this is what they are going to ask you for and base their decision on.
Any mortgage advisor at a bank is always just going to tell you to "come in and apply", that's their job, to get you into the branch even if they know already that they are unlikely to lend to you.....
You need to go to a specialist broker. A lot of the high street banks\building societies will want at least 2 years worth of limited company accounts and if you are using proper tax planning for your company, a lot of them will not understand it so you won't get offered a decent amount as a loan. A decent broker will be able to find you mortgage companies that do understand limited companies and how they are structured.
Don't be suckered into paying a fee though, they already make commission from the products they sell so if they try to lump you with an additional fee that's not part of the mortgage arrangement fee then tell them to Foxtrot off and find another broker.
Don't be suckered into paying a fee though, they already make commission from the products they sell so if they try to lump you with an additional fee that's not part of the mortgage arrangement fee then tell them to Foxtrot off and find another broker.
If it's any help, I was in a similar position to yourself, wanted to get a mortgage after being self employed for less than 2 years. I work as an IT contractor and used Contractor Financials (other brokers are available...) who managed to secure me a mortgage on the basis of showing that my existing work contract had 6 months to run.
Might be worth a ring?
Might be worth a ring?
Foster85 said:
If it's any help, I was in a similar position to yourself, wanted to get a mortgage after being self employed for less than 2 years. I work as an IT contractor and used Contractor Financials (other brokers are available...) who managed to secure me a mortgage on the basis of showing that my existing work contract had 6 months to run.
Might be worth a ring?
Different circumstances to the OP though........Might be worth a ring?
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