Self employed mortgage / salary grossed up?

coolaking

I am having some problems with getting a mortgage due to being self employed and poor salary multiples

I am 33% Director of a limited company trading for over 10 years with increasing turnover (currently £600k) and profits and £50k retained profit on books - this year ending July should be even better

I am looking at purchasing a house for £390k and have £140k deposit - good credit history no bad marks lots of settled debt

Current satisfactory mortgage with abbey for last 8 years

Is it correct that lenders don't gross up your dividends anymore and will only lend maximum of x 4 ?

Will all lenders only look at your income average or will some look at most recent (as divs are more year on year)

I just spoke to large broker call centre (guy sounded like a teenager and didn't fill me with confidence) and the amount they would lend me was not great, max x 4 of salary, no gross up of divs (just the amount I have been paid through company after corporation tax)

I am best going to my accountant and getting a good broker who can look at company accounts also?

many thanks

Dave_Ham

A good broker is highly likely (almost guaranteed) to be able to sort this for you.

Lender selection is important and knowing the most suitable lenders to optimise your rate and achieve the mortgage will be crucial.

Hope this helps reassure you that there is likely to be a solution and still at competitive rates.

All the best

Crashandburn

Some lenders will go high than the 4 times income.

Key would be what you've taken in salary and dividends. There are a few lenders that would also use retained profits as long as they aren't too historic.

https://www.unbiased.co.uk will give you details of local brokers who should be able to help on this front

Good luck

coolaking

thanks for the replies - is it the case that you don't add the tax credit on now - as the dividends are net of tax without this - I am sure you used to divide them by 0.9?

as this helps with the amount used in multiples

Crashandburn

Its the dividend plus the 10% tax credit

Wh05apk

Crashandburn wrote: »

Its the dividend plus the 10% tax credit

Except that lenders will only take the net amount, some will work off last years figures, some will take net profit into account.

Crashandburn

Wh05apk wrote: »

Except that lenders will only take the net amount, some will work off last years figures, some will take net profit into account.

So they take 90% of the SA302 figure?