Self certification advice desperately needed!

kneame

Hi,

My boyfriend and I are currently processing a mortgage through Chelsea BS but after 6 weeks they have decided to view my boyfriend as being self employed, even though he is salaried and legally is not. Anyway - Chelsea have been very slow so far and my boyfriend doesn't have last years accounts made up yet. By the time they're done we'll have added another few weeks delay, then we've got to have the valuation survey. So basically I reckon an offer (if we get one!) is at least 4-5 weeks away.

We're thinking of going the self certification route instead due to the lack of accounts but don't know if that'll be any quicker. We're worried the seller will get fed up and go elsewhere as there's no chain. I had a default on a loan almost 2 years ago for £1200 which I cleared immediately. We have about a 19% deposit and want to borrow just over 3.5 x joint income

What I wanted to know was - is self certification quick normally? And will my default cause us major problems? Can anyone recommend any lenders?

Thank you very much! We're finding this very stressful so any help is very much appreciated!

AndrewSmith

Post some details about your boyfriends work and employment status along with how long he has been doing it.

Also details of his earnings/how he is paid.

Andy

kneame

Thanks for the reply.

Boyfriend has been running his own business for 3+ years, but it was running as a partnership until 2 years ago when it became a limited company. He has 0304 accounts, but the 0405 accounts haven't been done yet.

He pays himself a salary of £24,000 via payroll (PAYE) which apparently legally means he's not self employed. He can provide pay slips and a P60. However, he is a 50% shareholder so it looks like that means lenders will consider him as self employed because of that.

Do you need anything else?

MortgageMamma

what us your purchase price and what kind of a deposit do you have? how quickly are you looking to complete?

kneame

Purchase price £235000. We have £45000 as deposit. We're not in any special rush to complete but we had our offer accepted 6 weeks ago and are not yet anywhere near sorted on the mortgage front. The people we're buying from are moving to rented accommodation. I don't know what their timescales are but they'll be waiting for us basically and I don't want to give them a reason to put the house back on the market.

Should have said in my original post that both my partner and I have very good credit history and despite the default, my credit rating comes out as 'Excellent'.

AndrewSmith

You are correct that for mortgage purposes he will be seen as self employed, due to the fact that he has controlling interest in the company.

May I ask why the 04/05 accounts are not done yet? He would have had to submit a self assessment return for that year by January 06, and should have a copy of the Inland Revenue return for this which should be sufficient for mortgage purposes as proof of income.

Whilst self certify may be an option I believe that the case needs to be investigated and looked at further before taking this route.

If you do have accounts for 03/04 and a copy of the IR confirmation return for 04/05 then you should be able to submit the case full status (subject to the income being sufficient of course).

Does he pay himself other income in the form of dividends or expenses etc?

Also what level of income do you have and what is your employment status?

Cheers

Andy

kneame

Thanks for that. I think I've got my financial years mixed up actually. He has 0405, but is still putting 0506 together. Sorry - always get financial years mixed up. Yesterday I was helping him find info for April 2005 - March 2006 so that's right isn't it? He also has 0304 partnership accounts.

He does pay himself dividends but they aren't ever fixed amounts or regular income so he didn't add them. We weren't sure how to declare how much he got / expected to get. They can be up to about £10000 or as little as £2000 (or nothing in theory).

I'm employed full time on a salary of £29700.

AndrewSmith

I though as much lol

I am still putting my 05/06 accounts together.

If you have 03/04 and 04/05, plus can prove the stability of the business for the last year etc then I see no reason why you cannot submit the case as full status.

It will be all about how the case is presented to the lender and clarification of the income received by your other half in addition to the 'salaried' income he receives.

Coupled with the fact that you have a salary of £29,700 I think that, although not every lender will accept you, you may have a pretty good mainstream case.

Andy

kneame

Fab! Thank you! We'll see how we get on with Chelsea then but if it all falls through it's reassuring to know we might still have a chance with some other people.

regularsaver1

I have managed to get a case through with a projection letter from accountant for the lender I work for as accounts were not ready - although is one not used here?

kneame

My boyfriends accountant has provided Chelsea with 0304 and 0405 accounts, and a projection letter as well but they're not accepting it. It's so frustrating!

Does anyone know of any self cert lenders who might lend in our circumstances? We're trying to go with Chelsea to self cert if they won't accept that normal route but not sure if my default will become a problem if we self cert. Can they assess me normally and my partner on a self cert basis or does it not work like that?