Does the bank need to see the deposit for mortgage?

bluedrop

Dear all,
The property is am buying costs 240k. I 'have' a deposit of 25%. 30k is in my personal bank account. 30k in my business account. I plan to apply for mortgage and once that is clear, exchange contracts by say 20 march.

I plan to pay myself the 30k as dividends after 6 apr ( for tax reasons)and then complete the sale.

Is this practical plan? Will the bank want to see all 60k in personal account before approving my mortgage?

Blue drop..

sirmosh

May not be doable, but I suspect the only way might be to get your accountant to give evidence you'll be paid the dividend. Since it's money you don't actually have yet though the lender may well not accept it as being suitable for a deposit. Why not delay the purchase until after April 6th?

jaysb

where is your 25% deposit, I think you only have 30K deposit on 240k.

don't think you can count your 30k in your business acct

bluedrop

jaysb wrote: »

don't think you can count your 30k in your business acct

Why? I can transfer it to my personal account right now ( dividends).... I am just trying to avoid paying extra tax if i can withdraw after 6 Apr. I own the business 100% and there is over 30k in retained profits....

hazyjo

Are you only just starting this purchase, or are you weeks/months into it already?

Jx

Henry_Hoover_2

I bought a property in 2008 and another last year, and wasn't asked to prove that I had a deposit available. (This was with Halifax).

HappyMJ

You don't need to prove your deposit. I bought a house relying on the last few percent to come from my salary which was hopefully going to be paid the day before completion. I had no backup plan if my salary failed to be paid on time.

jimpix12

Sorry, but some of the advice given here is wrong. I applied and was granted a mortgage last week, and I had a 100k deposit. I had to comply with the lender's money laundering regulations and show not only that I had the amount, but that it was gained "legally" through savings and provide historical bank statements. This was with Coventry BS.

In the end I printed off my company bank statements as well, just in case, and showed them that. It took 2 weeks for it to be approved, but eventually it was.

I also withdrew money from company account for dividends, they have no issues with this, I told the MA and she said it was fine and commonplace. Caveat: Every lender varies, etc.

jaysb

bluedrop wrote: »

Why? I can transfer it to my personal account right now ( dividends).... I am just trying to avoid paying extra tax if i can withdraw after 6 Apr. I own the business 100% and there is over 30k in retained profits....

it sounds like you need to check with the lender - but good luck

I've remortgaged several times , but have done so again recently. The ID checks were more thorough this time - with my current lender - don't know if this is more a sign of the times, regulation or just because it was a different lender

bluedrop

hazyjo wrote: »

Are you only just starting this purchase, or are you weeks/months into it already?

Jx

Our offer was accepted last week. We are just about to begin the process.