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    • misteriley
    • By misteriley 6th Sep 17, 7:56 PM
    • 4Posts
    • 0Thanks
    misteriley
    Buy to let query...
    • #1
    • 6th Sep 17, 7:56 PM
    Buy to let query... 6th Sep 17 at 7:56 PM
    I currently have a buy to let and a residential, in Jan 18 I am looking to get another BTL...However last month I started a contract role, this will initially last until December but is paying a years salary in 4 months.

    My problem: how would I apply for a mortgage when.

    A) as a new contractor I can't show two years accounts
    B) what if my contract is not extended and I am in limbo looking for another

    I know I'll need a broker, just wondered if anyone knew or had similar issues.

    Thanks all
Page 1
    • glosoli
    • By glosoli 6th Sep 17, 8:11 PM
    • 673 Posts
    • 387 Thanks
    glosoli
    • #2
    • 6th Sep 17, 8:11 PM
    • #2
    • 6th Sep 17, 8:11 PM
    With some difficulty to be honest.

    Whilst there is variation amongst lenders in relation to their criteria, in terms of whether they will accept accounts or calculate your GAI from your daily rate, a combination of short contracting history, only evidence of one contract which may/not be renewed, no limited company accounts etc, would make it a difficult application to place.

    Assuming the application was approved initially, if the offer document is produced after the expiry date of your existing contract, then they will probably require another contract, and if you can't produce that then it probably would not progress until you got it sorted.

    Any reason why your looking to it in January? Seems to be a bit rushed and if nothing will only narrow down your choices.
    • misteriley
    • By misteriley 6th Sep 17, 8:56 PM
    • 4 Posts
    • 0 Thanks
    misteriley
    • #3
    • 6th Sep 17, 8:56 PM
    • #3
    • 6th Sep 17, 8:56 PM
    True, I say January, as it's a 'worst case scenario' i.e.: could have no contract or history, I work in IT, so it's quite easy to take on a perm role, I just don't like the idea of 'using' an employer and as you highlighted I will be seen as a risk with little contract history.

    Reason I asked is according to The Post Office website, earnings/income isn't mentioned in the criteria, they emphasise the rental rate more.
    • misteriley
    • By misteriley 6th Sep 17, 8:59 PM
    • 4 Posts
    • 0 Thanks
    misteriley
    • #4
    • 6th Sep 17, 8:59 PM
    • #4
    • 6th Sep 17, 8:59 PM
    From their site:

    Ability to pay is assessed on rental income (which must be received in GBP). The rental income must be at least 145% of the monthly interest due inclusive of any product fees added to the loan. This is calculated using the initial product rate or one of the rates from the table below depending on your circumstance, whichever is higher.
    • glosoli
    • By glosoli 6th Sep 17, 9:29 PM
    • 673 Posts
    • 387 Thanks
    glosoli
    • #5
    • 6th Sep 17, 9:29 PM
    • #5
    • 6th Sep 17, 9:29 PM
    Their website includes "Your application will be reviewed to ensure your ability to pay, including the level of unsecured and mortgage debt held in relation to your income.", so if they are unable to take your earned income into consideration for whatever reason, then I doubt the application will go anywhere. Might be worth a try though I guess.
    • Dorian1958
    • By Dorian1958 6th Sep 17, 9:41 PM
    • 90 Posts
    • 56 Thanks
    Dorian1958
    • #6
    • 6th Sep 17, 9:41 PM
    • #6
    • 6th Sep 17, 9:41 PM
    Post Office lending criteria under Ability to Pay section also states "Your application will be reviewed to ensure your ability to pay, including the level of unsecured and mortgage debt held in relation to your income." So although an income amount is not specified, they are going to want to see evidence of income, in case of a tenant defaulting on the rent. Best to give them a call to discuss, 0800 number on the bottom of their lending criteria.
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