Mortgage after purchase

theEnd

Strange situation. Any help would be appreciated.

Been turned down for a mortgage at the last minute. They didn't understand my accounts.

Can buy the flat anyway, but means loaning the money from my own company and paying back before April.

Would it be difficult to remortgage after purchase for say 50% LTV with the intention of using this to pay back the company?

thanks

Dave_Ham

Not necessarily, but you need to be careful that 90% of lenders will not remortgage within 6 months of completion.

Not sure if you used a broker first time, although if you did not a good one the issues you are experiencing but well worth engaging one at this point..

Best of luck

Foxy-Stoat_3

I don't think buying a £100,000 property for £50,000 purchase price counts as a deposit in the lender's eyes.

theEnd

Dave_Ham wrote: »

Not necessarily, but you need to be careful that 90% of lenders will not remortgage within 6 months of completion.

Not sure if you used a broker first time, although if you did not a good one the issues you are experiencing but well worth engaging one at this point..

Best of luck

Didn't use a broker. I thought it would be very straight forward!

theEnd

Foxy-Stoat wrote: »

I don't think buying a £100,000 property for £50,000 purchase price counts as a deposit in the lender's eyes.

Sorry, don't understand.

Foxy-Stoat_3

Your company buys it for £100,000 for example....then sells it to you for half the value, so technically your LTV would be 50%....unless I understood it differently and you have 50% cash deposit.

If you have 50% deposit then any decent broker will be able to help you place the mortgage.

GMS

Speak to a broker first as Dave says.

Need to ensure the exit is there after 6 months in order to repay the loan to your company.

How are you set up? Ltd or sole trader?

Which lender turned you down?

Is it an affordability issue?

theEnd

Foxy-Stoat wrote: »

Your company buys it for £100,000 for example....then sells it to you for half the value, so technically your LTV would be 50%....unless I understood it differently and you have 50% cash deposit.

If you have 50% deposit then any decent broker will be able to help you place the mortgage.

No, company never owns it.

Say the house is £100k, I have £50k in savings and £200k in a Ltd company.
Borrow the £50k from the company to pay the 100k for the house. Then remortgage before April to get the £50k to pay back to the company. Otherwise the £50k becomes a dividend with tax due.

* the numbers are bigger.

Foxy-Stoat_3

theEnd wrote: »

No, company never owns it.

Say the house is £100k, I have £50k in savings and £200k in a Ltd company.
Borrow the £50k from the company to pay the 100k for the house. Then remortgage before April to get the £50k to pay back to the company. Otherwise the £50k becomes a dividend with tax due.

* the numbers are bigger.

Clearer now....can you not speak to your accountant about a soft loan, or do you need the "£50K" back into your company by April to pay VAT or other bills?

Still can't see a broker being unable to place a 50% LTV mortgage though.

theEnd

Foxy-Stoat wrote: »

Clearer now....can you not speak to your accountant about a soft loan, or do you need the "£50K" back into your company by April to pay VAT or other bills?

Still can't see a broker being unable to place a 50% LTV mortgage though.

I think it can roll over the tax year end. Need to look into it a bit more, as there's tax to pay that can be refunded.

Should be fine on all other bills. VAT just paid, Corp tax due next July. Still plenty of income still to receive.

I've contacted a broker now. Friend recommended.

theEnd

Update:

Completed a week ago, got mortgage today.
Should have gone to a broker from the start. Lesson learnt. All worked out in the end.