Director of ltd by guarantee company & mortgage

Let_Us_See

I previously posted I believed you should be treated as employed for mortgage purposes, and I still believe it. However, I am more surprised you need a 33 year term for £70,000 mortgage borrowing? I can only assume you both have relatively small incomes?

Thrugelmir

hohum wrote: »

What doesn't look good? Are you referring to the mortgage application, the likelihood the company will want to refer to accounts, or just analysing my business based on this information? Why does the company being not for profit make a difference?

Sorry I meant to add this to my original post.

The fact that our company accounts show we made a loss in the first year may have something to do with my concern.

hohum

Let_Us_See wrote: »

I previously posted I believed you should be treated as employed for mortgage purposes, and I still believe it. However, I am more surprised you need a 33 year term for £70,000 mortgage borrowing? I can only assume you both have relatively small incomes?

Yeah. I also think I should be treated as employed but as I'm not the one advocating for myself with the lender, I'm having to trust that this is also a way to do it.

Last year my income was TINY - first year of the company and I earned very little. My capital was my time, for free. Very little is as in (well) under minimum wage. My return this year will show I doubled my income.

However we still managed to pay our £450 monthly rent whilst I earnt bog all. Apparently we can only afford to repay £240 a month. Lolz. Even with adding on £100 monthly property owner additional added expense allowance that's still..conservative. My thoughts are we continue to pay £450 a month until fixed term comes to an end and remortgage - by which point my income whether PAYE or SA302 will be enough for a lender to be a bit more relaxed about.

We are lucky enough to have a decent gifted deposit to assuage concerns/ deal with lender inability to process my employment status but it does make you realise how far out of reach this whole business makes owning for a lot of people.

hohum

Urgh. This is painful. Application lurches on. We have been referred to a senior underwriter because apparently my business breaks people's brains. And more understandably, because we only have one year of accounts for business.

I think this will all depend how well my broker can articulate my business to the underwriter. There's a reasonable narrative that my last tax return shows a small dip in income which was setting up the business. My payslips show I have doubled the amount I take home through working in the business. I am essentially doing the same job, under a different organisational set up. I was responsible for generating the work when I was self employed, I'm now jointly responsible for generating the work. I'm still in the same field, working with some of the same people I was when I was self employed.

And we have £25k just sat there ready to go. With monthly repayments half of what we pay in rent the last four years. Ah well. I just had to be non-standard.

hohum

An update. Halifax have refused on basis of concerns re sustainability of my business, as we have only one year accounts for the company and we receive grant income. We also receive income from clients, but apparently because we also operate grant eligible projects, I am existing on arty fairy dust in a sector which I have made a (small) living in for a decade. I am absolutely hopping mad. If the income was a loan, or private investment they probably wouldn't have an issue with it.

For some reason broker put me in as self employed director paid through PAYE. Not sure if that makes any difference in terms of morons not understanding how lottery funding works.

Absolutely steaming annoyed!

ETA we're going to approach a different lender. So annoyed.

saverbuyer

hohum wrote: »

An update. Halifax have refused on basis of concerns re sustainability of my business, as we have only one year accounts for the company and we receive grant income. We also receive income from clients, but apparently because we also operate grant eligible projects, I am existing on arty fairy dust in a sector which I have made a (small) living in for a decade. I am absolutely hopping mad. If the income was a loan, or private investment they probably wouldn't have an issue with it.

For some reason broker put me in as self employed director paid through PAYE. Not sure if that makes any difference in terms of morons not understanding how lottery funding works.

Absolutely steaming annoyed!

ETA we're going to approach a different lender. So annoyed.

Can you not come off as being a director and just go with your PAYE earnings? Set you OH up as the director.

hohum

saverbuyer wrote: »

Can you not come off as being a director and just go with your PAYE earnings? Set you OH up as the director.

It's not a terrible idea, although I'm not sure what it will do re my having previously been a director, and timelines for notifying Companies House etc. My company years runs September to September helpfully.

I'm not sure having OH as director would be the solution. There are two other directors, one of whom is non-acting Will have a think and possibly mention to broker.

saverbuyer

hohum wrote: »

It's not a terrible idea, although I'm not sure what it will do re my having previously been a director, and timelines for notifying Companies House etc. My company years runs September to September helpfully.

I'm not sure having OH as director would be the solution. There are two other directors, one of whom is non-acting Will have a think and possibly mention to broker.

I just realised the OH is self employed, so wouldn't work.


If there are two other directors I don't see what the problem is. I'm a director of a couple of limited by guarantee companies (unpaid, voluntary sector) and I know the directors change throughout the year. Not just at the annual return.


I know a few people who work for social enterprises (and will be directors). I'd be nearly certain that every one of them has applies for a mortgage as a PAYE employee.

Mortgage_Mark_2

Just seen this - cannot understand why a broker would suggest you apply as self-employed with 1yr of company accounts, when the company made a loss!!!

Guaranteed fail, unfortunately!

I don't think anyone will do this on self-employed criteria whatsoever, and you'd only be able to use PAYE if you own less than 20/25% of the company....

Thrugelmir

hohum wrote: »

Not sure if that makes any difference in terms of morons not understanding how lottery funding works.

Any moron would question the business model and it's sustainability.