Self employed for less than a year, how to get a mortgage?

chanki25

Hello all,

I am now self employed, after being in employment with various organisations for 5 years. But it has only been 4 months, and I want to get a mortgage...is that possible? If so how?

Thanks to all!
Chanki




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Most people dream of accomplishments, some stay awake and do them.

HappyMJ

chanki25 wrote: »

Hello all,

I am now self employed, after being in employment with various organisations for 5 years. But it has only been 4 months, and I want to get a mortgage...is that possible? If so how?

Thanks to all!
Chanki.

It is possible if you have fixed term contracts with your clients and you have a deposit of at least 25%.

Wh05apk

HappyMJ wrote: »

It is possible if you have fixed term contracts with your clients and you have a deposit of at least 25%.

Is it?

As far as I know you will need at least 1 years accounts, you may find your own bank may be able to lend without proof of income based on funds flowing through your account.

chanki25

I am now in retail...so no real fixed term clients...

and already asked my bank, and that didn't work out. They can't help self-employed people (HSBC), need a full time employment or at least 1 year's accounts from my accountant... which is why I am scratching my head :mad: hard times...

Dave_Ham

It will come down to your deposit.. If you have 10% this will be virtually impossible.

With 15%+ there may be lenders that will consider this case indvidually but will depend upon more detail and underwrite the case in detail.

The bigger the deposit, the more chance you will have..

What sort of prices and deposit are you looking at...?

zxspeccy

Unfortunately what the bank have told you is correct and you will struggle with getting a mortgage at the moment.

The question is do you want to burden yourself with a 25 year debt whilst starting up a business on your own. I would recommend you see how it goes, if your business is a success then you should be in a position to save up a nice deposit, which will help get you a decent mortgage interest rate. If it fails then thank your lucking stars that you didn’t commit yourself to a mortgage and go through the stress of a repossession order.

Once you’ve got at least one set of audited accounts to show the bank, and a nice deposit save up then you will be in a much better position. A mortgage is for life and usually you just get one chance at it, if you end up losing your house then it is unlikely that you will be able to get on the property ladder for a very long time.

chanki25

Yeah that's the thing, I am looking at properties that cost around 150k, and I can arrange for a 15k deposit...so will need to borrow the rest, 135k. I am a first time buyer too. I have been looking around if there were any sort of help for first time buyers, but couldn't really find anything except on brand new properties.

HappyMJ

chanki25 wrote: »

Yeah that's the thing, I am looking at properties that cost around 150k, and I can arrange for a 15k deposit...so will need to borrow the rest, 135k. I am a first time buyer too. I have been looking around if there were any sort of help for first time buyers, but couldn't really find anything except on brand new properties.

What is your turnover? What is your profit?

Wh05apk

at 90% I don't think you would stand a chance, also you say you can "arrange" the deposit? That also would not help, as lenders like to see you have saved the deposit yourself.

chanki25

Hmm, yeah all of this, isn't looking great.

I should probably just wait for a whole year of accounts and try to get on the property ladder.

Thanks to all for your help.

Dave_Ham

chanki25 wrote: »

Hmm, yeah all of this, isn't looking great.

I should probably just wait for a whole year of accounts and try to get on the property ladder.

Thanks to all for your help.

Good luck - you are right on your assumption, not a good time now as you will just waste time and money.

All the best