First time buyer - Difficulty as self employed?

jellypigs

We saw a beautiful home, leasehold, £170,000

Unable to get a mortgage as self employed - obviously pay as little dividends as possible. We definitely make enough and can afford it, so is there a way round it? Or will we struggle to find a mortgage at all!?

kingstreet

You'll need total earnings of around a quarter of the mortgage amount and a deposit to make up the purchase price. The more deposit, the better, but probably 10% is the minimum.

The self-employed do not have a problem getting a mortgage as long as;-

- they have enough income (just like the employed)
- their trading period is a couple of years or longer.

jellypigs

So, £50,000 for a £200,000 mortgage? Last year was around £30,000 and its 2-3 years in.

Blimey thats insane! Barratts were after 5% on this place! Just frustrating when my friend who works at boots managed to get one without problems!

kingstreet

There are some lenders who will lend 5x joint income. It's net profit in the case of the self-employed, but you mention dividends, so I presume you operate a limited company.

Employees get the same income multiples, they simply require less "history" than the self-employed.