Self-employed mortgage with 2 year accounts

Chan99

Hi,

Myself and my partner are looking to get a 70% ltv mortgage - I'm full-time employed and my partner is self-employed (and was in continuous permanent employment in the same field for 11 years previously). We're well within our multiples (though not quite enough to just do in my name) and have a decent deposit.

From speaking to a mortgage broker and reading recent articles online we were led to believe that most lenders accepted two years of accounts, however we've just been point blank refused by First Direct and are being assessed by Barclays in the morning. We have current accounts with Santander (if that counts for anything) - though they also say three years of accounts in their small print.

Has anyone had any recent experience of getting a mortgage in a similar situation, or know of any lenders who are less harsh on the self-employed? Quite gutted to think we may struggle to find one!

Thanks for any help

kingstreet

One or two lenders will accept one year's accounts.

A good few will accept a minimum of two years.

There are some who want three years' minimum.

Maybe you happened on one with a three year minimum?

ACG

You will be able to get a mortgage, but you need to find the right lender. Most lenders will want 3 years accounts... but not all.

Chan99

Thanks for your replies. My partner's just said that although he has an accountant he has not had them audited. I'm confused as to whether this is a problem with mortgage lenders as a broker I spoke to just said he needed to submit an SA302 for the last 2 years. However I've seen the term 'audited accounts' mentioned by some.

Simon_gloster

If the accounts haven't been finalised let alone assessed by HMRC there is no way the self employed income will he used by the omajority of mainstream lenders.

SA302's ie income declared for tax purposes is the preferred method these days.

Chan99

I think it's just the terminology that's confused us. He has 2 years of accounts and used a chartered accountant and as a sole trader just needs an SA302 form to apply for a self employed mortgage. We've just spoken to a mainstream lender who've confirmed this.

Phew! Thanks again for all the replies.

Simon_gloster

That's ok then. They are free from HMRC albeit about 4 days to your doormat once requested. You need to use the 'total income on which tax is due' or something like that.
All the best

kingstreet

Accounts need to be signed by the Accountant, they do not need to be audited for a mortgage lender.

As has been said, SA302s can be obtained from HMRC in lieu of accounts, if easier for you. You'll probably be asked for a number of months' bank statements too, as we are close to the end of the tax year.