Newly self employed - mortgages

weblues

Hello,

Is there any mortgage brokers out there who will consider me for a mortgage. I have been self employed for 3 months. I have about 25% deposit, 1 property 85% paid off (with RBS..) and a good income. So far I have had no luck with banks but wanted to check with the larger community of mortage advisors prior to go renting for a while?


Weblues

koexelek

Start looking for rented accomomodation:(

One years full accounts is the absolute minimum requirement.

If you bank with Barclays though, it is worth checking if you have a " pre approved mortgage limit". If you have, you might be lucky.

kingstreet

Are you renting out the first property?

If so, could you remortgage it and raise the money you need that way?

Some lenders don't take your personal trading record/income into account for a BTL as long as the rent exceeds the interest-only mortgage payment by 25%.

As koexelek says, the bare minimum for a self-employed individual is twelve months accounts and a big deposit.

weblues

I am planning on using the two properties. The property I currently own is a small flat - only has 85K equity in it and I would be looking to borrow substantially more 300K.

You did give me an idea, is it legal to get a buy to let and then lets say rent it out to yourself? via an intermediary?

eyeofthetyne

I was self employed from 2005 and rented a flat. It was a massive amount of dead money at around £700 a month.

In 2009 I was able to supply 3 years full accounts and had a 25% deposit and that was the minimum for Natwest to accept me.

That said, I showed growth over my accounts. My first accounts for year 1 only showed a profit of around £11,000. This grew to around 19,000 and then 27,000. They used an average to offer me a mortgage.

Yorkie1

weblues wrote: »

You did give me an idea, is it legal to get a buy to let and then lets say rent it out to yourself? via an intermediary?

This does sound rather like fraud to me.

kingstreet

weblues wrote: »

You did give me an idea, is it legal to get a buy to let and then lets say rent it out to yourself? via an intermediary?

No it isn't. The FSA is well aware of BTL products being used to bypass the affordability rules for residential mortgages and is working with lenders to ensure it stops.