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Self-employed mortgage when earnings have declined
vmp
Posts: 37 Forumite
I've just discovered my self-employed earnings for 2014-15 are lower than my 2013-14 earnings.
Does anyone have any experience of applying for a mortgage when this is the case?
What generally happens?
For example, do they take your most recent (lower) earnings rather than an average? Or do they say you can't have a mortgage at all? :eek:
Thanks
Does anyone have any experience of applying for a mortgage when this is the case?
What generally happens?
For example, do they take your most recent (lower) earnings rather than an average? Or do they say you can't have a mortgage at all? :eek:
Thanks
0
Comments
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Depends on the lender - speak to a broker.I am a mortgage adviser.You should note that this site doesn't check my status as a Mortgage Adviser, so you need to take my word for it. This signature is here as I follow MSE's Mortgage Adviser Code of Conduct. Any posts on here are for information and discussion purposes only and shouldn't be seen as financial advice.0
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What are the possible different scenarios?Mortgage_Mark wrote: »Depends on the lender - speak to a broker.0 -
Expect the Lender to work on the more recent figures onlyI am a Mortgage Broker
You should note that this site doesn't check my status as a Mortgage Broker, so you need to take my word for it. This signature is here as I follow MSE's Mortgage Adviser Code of Conduct. Any posts on here are for information and discussion purposes only and shouldn't be seen as financial advice.0 -
Ours looked at our last three years of tax returns and took the average.0
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Average is taken if there is an upward trend.Ours looked at our last three years of tax returns and took the average.
If the trend is downward, latest year will be taken.
Please share your trend. Up or down?I am a mortgage broker. You should note that this site doesn't check my status as a Mortgage Adviser, so you need to take my word for it. This signature is here as I follow MSE's Mortgage Adviser Code of Conduct. Any posts on here are for information and discussion purposes only and shouldn't be seen as financial advice. Please do not send PMs asking for one-to-one-advice, or representation.0 -
kingstreet wrote: »Average is taken if there is an upward trend.
If the trend is downward, latest year will be taken.
Banks are so nice! Basically any discrepancy you should bend over and brace yourself!0 -
kingstreet wrote: »Average is taken if there is an upward trend.
If the trend is downward, latest year will be taken.
Please share your trend. Up or down?
Up, down, then up again, but not as high as the first year they took.
Frankly, I didn't think they cared because they were also our business bankers so could see what was going through the accounts every month. I suspected this because what they offered us was almost 4 times our earnings.
What happened then though was the house we wanted to buy needed a fair bit of renovation (house in poor condition in a good area) and their valuer came to see it - yes, he actually came in the flesh - and recommended to the bank they offer a lower mortgage because of its poor state of repair. We could still have gone ahead at that point, but it would have severely affected our renovation fund.0 -
OP, would a self cert mortgage help? I see they are on their way back. Quick Loans is launching their product in Jan 2016 and this broker seems to think he can get people one even now:
http://self-certified-mortgages-123.co.uk/
Is this one a scam?
The only way I can see self cert mortgages coming back is if the mortgage provider is registered elsewhere in the EU, so they don't have to adhere to the Mortgage market Review the FCA undertook, which explicitly banned self certification. Instead they have to follow the Mortgage Credit Directive (not sure if this is "live" yet) which has less strict rules on income verification.0 -
I am amazed this guy's website is up - his FCA registration appears to be defunct.
This page listed above is nonsense.
There are NO self certified mortgages available in the market - the regulator blocked them finally last year under the Mortgage Market Review.I am a Mortgage Broker
You should note that this site doesn't check my status as a Mortgage Broker, so you need to take my word for it. This signature is here as I follow MSE's Mortgage Adviser Code of Conduct. Any posts on here are for information and discussion purposes only and shouldn't be seen as financial advice.0 -
Instead they have to follow the Mortgage Credit Directive (not sure if this is "live" yet) which has less strict rules on income verification.
No it doesn'tI am a Mortgage Broker
You should note that this site doesn't check my status as a Mortgage Broker, so you need to take my word for it. This signature is here as I follow MSE's Mortgage Adviser Code of Conduct. Any posts on here are for information and discussion purposes only and shouldn't be seen as financial advice.0
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