Self Employed Mortgages

roberts_driskell

Hi

I am self employed and have been since Sept 2008. After one bad year in 09/10 business has been going well and I have increase profits enough to become a limited company last July.
Our mortage is with First Direct and we have had no problems with them at all until now. Everytime we contact them regarding a new mortage so we can move home they want us to wait until we have another year of accounts. It is incredible that we are being penalised because my company is succeeding and in their view the year on year profits are jumping too much!!!!
Can any one suggest a good bank that does mortages for people running their own businesses?

Cheers

Paul

kingstreet

All lenders accept applications from the self-employed and company directors. Their criteria varies, as does their requirement for business longevity, loan to value, evidence of income and method of income calculation.

The normal route for choosing a lender, is to find the deal which suits you best, then see if you fit their criteria. If not, move on to the second on the list and so on...

downsizer3

I'm self employed too. After a 'bad year' they require to see a steady increase in profit over several ( 2 or 3) years I believe.
Nothing to stop you shopping around - I got a mortgage broker to deal with mine - and got a good rate - being self employed makes no diference as long as you can demonstrate a stable income.

koexelek

downsizer3 wrote: »

- being self employed makes no diference as long as you can demonstrate a stable income.

correct. lenders do not offer different rates for self employed and employed, just that they need more information for the self employed.

I think it is fair to say that most lenders would prefer to lend to an employed person than a self employed person, any day of the week though.
Last month's payslip is usually good enough for employed, where as they normally want three years info for the self employed

Thrugelmir

roberts_driskell wrote: »

It is incredible that we are being penalised because my company is succeeding and in their view the year on year profits are jumping too much!!!!

Solid established businesses produce consistant level of profitability. Fluctuating profit indicates a number of potential concerns.

Conrad

2 years reasonable trading history can be sufficient to get a yes.
One lender will add back in certain 'expenses' to increase your net income level.

Bare in mind they will treat the Ltd Co as a new business and exclude any prior sole trader numbers.

Use common sense. Certain business sectors are viewed as high risk. Service consultant sounds better than drain unblocker!