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The madness of the mortgage world!
ACG
Posts: 25,089
Forumite
I can only post limited information but I just thought this needed to be shared...
I have a client who is a minority shareholder in a business. His income is £10k paye and around 5-6x that in dividends. Because he owns less than 20%, there is a well known lender that would only use £10k worth of income when assessing his affordability.
I have not applied to them, it is just part of the research. Its funny as most lenders are working off an income of around £60-70k for him, yet one lender is working off an income of £10k. So one lender will lender him over £300k and another will lend him £35k.
That is the biggest difference I have come across in 5 years doing the job.
I have a client who is a minority shareholder in a business. His income is £10k paye and around 5-6x that in dividends. Because he owns less than 20%, there is a well known lender that would only use £10k worth of income when assessing his affordability.
I have not applied to them, it is just part of the research. Its funny as most lenders are working off an income of around £60-70k for him, yet one lender is working off an income of £10k. So one lender will lender him over £300k and another will lend him £35k.
That is the biggest difference I have come across in 5 years doing the job.
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
Comments
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Minority shareholders are somewhat disadvantaged. Could be simply just be a commercial lending policy in this instance.0
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I have finished my research and it is quite surprising at the difference in how it is viewed.
The lowest was £35k and the highest is over 10 times that!
I have never seen them that far apart before.I am a Mortgage AdviserYou 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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