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MSE News: Mortgage door slammed shut on the newly self employed
Former_MSE_Guy
Posts: 1,650 Forumite
This is the discussion thread for the following MSE News Story:
"The recently self employed will be virtually excluded from getting a mortgage from next week ..."
"The recently self employed will be virtually excluded from getting a mortgage from next week ..."
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Comments
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The pros and cons for self-certification and the way they have been abused by many as a cover for unaffordability has been well documented on this site. Do we have to return to this old chestnut?0
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Let_Us_See wrote: »The pros and cons for self-certification and the way they have been abused by many as a cover for unaffordability has been well documented on this site. Do we have to return to this old chestnut?
not when there's a nice emotive title for the article0 -
It's unfortunate, but that's the way life is. It used to be hard, now it's hard again.
Big deal.
There are hundreds of more annoying things in life. Mortgageability is one thing all self-employed people need to think about - and is it really a good time to be leveraging up their debt when they've started a new venture anyway?0 -
not when there's a nice emotive title for the article
I guess it was more dramatic than my title
I am a Mortgage AdviserYou should note that this site doesn't check my status as a Mortgage Adviser, so you need to take my word for it. This signature is here as I follow MSE's Mortgage Adviser Code of Conduct. Any posts on here are for information and discussion purposes only and shouldn't be seen as financial advice.0 -
I am in a bit of a crazy situation at the moment because of this purge on the self-employed. I was promoted to a directorship at an SME, gaining a good jump in salary at the time. I have been on the rubbish std variable rate with my current mortgage provider for about 12mths and am looking to remortgage to a tracker. The ING direct one looked ideal with comparatively low costs of set up. I got through a couple of stages only to find out that because i am a director i am now classified as self-employed by their underwriters.
This means that they require 2 years tax returns (not done any before) and I will be lodging my first one shortly but clearly it is impossible to satisfy the 2 years. My argument is that seeing as i was looking for just over £50k and my previous salary of about £25k would have been more than enough to be approved, why should it be that now i can't get a mortgage which if i wasn't on the directors list i would have been approved for without hesitation?
I offered to provide 2 years worth of pay slips or as many bank statements as they like, but a repeated "i'm sorry but you are classed as self-employed and so the only acceptable proof is 2 yrs tax returns" was all i got. This is absolutely crazy. I am a director. I get paid a salary, but have no additional income (eg shares in company or whatever bonuses). I can prove my income to be sufficient over a period going back as long as they like but I am not given the chance.
Are there any mortgage lenders who do not just broad brush all directors as self-employed and then treat them like a sole proprietor who has just set up his own company? The thing is, i have no authority regarding salaries, bonuses or whatever and am just paid a salary like i was previously, proof of which is easy to provide.
Edit: (i am going to post this as a new thread for best chance of most help)0 -
With ones years worth of accounts you may have limited options - but it will depend on the whole scenario and not just the accounts
Best bet is to speak to a whole of market mortgage adviserI am a Mortgage AdviserYou should note that this site doesn't check my status as a Mortgage Adviser, so you need to take my word for it. This signature is here as I follow MSE's Mortgage Adviser Code of Conduct. Any posts on here are for information and discussion purposes only and shouldn't be seen as financial advice.0 -
Madness isnt it! I am unable to get a mortgage with my bank apparently as I have recently gone self employed I wanted to borrow, 20k on a 200k house, the rest of the deposit I was putting down myself. I have excellent credit rating and more than adequate funds going through the accounts, apparently I am a higher risk than a FTB needing a 95% mortgage! Cant see how myself, however they would give me a personal loan for that amount which is an unsecured debt, but obviously at a higher interest rate and therefore more of a moneyspinner for them. Have hopefully managed to secure the funds elsewhere at 1.5%.Pawpurrs x
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...Best bet is to speak to a whole of market mortgage adviser
As your signature says you are a mortgage advisor, perhaps you'd care to divulge some information for the benefit of the rest of us?
... or are you just here touting for business???
"Now to trolling as a concept. .... Personally, I've always found it a little sad that people choose to spend such a large proportion of their lives in this way but they do, and we have to deal with it." - MSE Forum Manager 6th July 20100 -
Madness isnt it! I am unable to get a mortgage with my bank apparently as I have recently gone self employed I wanted to borrow, 20k on a 200k house, the rest of the deposit I was putting down myself. I have excellent credit rating and more than adequate funds going through the accounts, apparently I am a higher risk than a FTB needing a 95% mortgage! Cant see how myself, however they would give me a personal loan for that amount which is an unsecured debt, but obviously at a higher interest rate and therefore more of a moneyspinner for them. Have hopefully managed to secure the funds elsewhere at 1.5%.
Bonkers is the word. It is because we live in a world of decision trees and call centre automatons.0
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