One for the Brokers out there

wannabehomeowner_2

Hi everyone

Hoping one of you knowledgeable Brokers can help; I'm trying to ascertain when we can look at applying for a mortgage. Here is our situation:

We are two Ltd. company contractors working in the engineering industry. OH has two years of accounts, but I only just set up my company at the beginning of this year (having previously worked as a 'temp' for the same company on various projects for the last seven years on and off).

I have four defaults on my credit files, all settled, dated Nov-09 (x2), Mar-11 and July-11, ranging from £100 to £650.

So, my questions are:

1) When can we look at applying? I have read various things about needing two/three years of accounts, but also a colleague has suggested that there are lenders who will assess on a day rate and no history is required.

2) How much deposit (LTV) will we need, given the defaults?

3) If my colleague is right, and there are lenders who don't require two/three years of accounts, will any of them consider us in the near future, given the defaults?

As an aside, we have a combined income of over £140K and would be looking at houses in the region of £350K so I'm not worried about affordability. We have no dependants, and currently debt is less than 10% of income (one car on HP, one personal loan). Both have two credit cards each which are paid off in full each month and overdrafts are unused.

Any guidance will be gratefully received.

Thanks in advance

CC

ACG

1) Speak to a broker now, it could be possible, depending on the LTV.
2) I would say 15% deposit would be needed.
3) Potentially yes.

My advice would be to speak to a broker and assuming the deposit is there, you stand a relatively good chance of getting it through. Rates wont be market leading but they wont be too bad (under 5% potentially).

wannabehomeowner_2

Hi ACG

Many thanks for your prompt reply. It is looking pretty promising. We were originally aiming to save for a 20-25% deposit so it is very good to know we might be able to do this sooner. We currently have just under 10% at the moment, so a few more months of saving and I'll engage a broker.

OH's parents have offered to gift us some of the deposit so we can get on the ladder ASAP, as they are worried about rising house prices, but I would rather not go down that route. Perhaps we will take them up on the offer for stamp duty/fees etc., when the time comes.

Super news to start the week with, thanks again!

CC

amnblog

Assuming your partners income is insufficient to make affordability without your input, you will need a minimum years trading.

Albert_Tatlock_2

I’m currently in what’s turned out to be a very long process of switching my mortgage from Stnd Variable Rate to a Fixed deal with the same lender.

Its taken an inordinate length of time for what should be a relatively straight-forward process, especially as my monthly payments will reduce.

Anyway, to the point – I have been trading as a Ltd Co for circa 18 months now. I was able to provide 2 Years Self-Assessment. The lender wanted 3, but in lieu of this they’ve also contacted my accountant to obtain an Accountant’s Mortgage Certificate which basically forecasts this year’s income.

An alternative solution may be to go with a specialist broker, for example these:

http://www.contractormortgagesuk.com/

amnblog

A broker, whomever it is, cannot change the lending criteria.

1 years trading.

wannabehomeowner_2

Thanks for the replies.

Sorry to hear of your troubles, Albert Tatlock, I hope you get a positive outcome soon. Thanks for the link; I think the only way to go with this will be via a specialist.

amnblog - Unfortunately, I am the higher earner and the lion's share of the deposit is held in my name, so it's not really an option to go down the sole route.

I had previously read that it is do-able on one year of accounts, but with any adverse on credit files, 2/3 years are required?

Your answer appears to be conflicting that of ACG; can either of you clarify further?

Many thanks

CC

ACG

As a contractor there may be lenders who do not need 1 years accounts - as ever it comes down to the finer details.

Im not saying it will be possible, but I would certainly be giving it a good try.