Mortgage as a self employed as well as employed person

goatelope16

Hello,

I am hoping someone might be able to help.

I have finally got a deposit together and am hoping to get on the property ladder this year. I am 39 and I have 60k saved.

I am employed on a permanent contract and my salary is £41,500
I am also self employed. I made only a small amount Year 1 (about £1600) but a much higher amount Year 2 (tax year 2018-2019) - just over £12k.

I would really like to raise a mortgage of around 230-240k, and so my questions are:

Will any lenders take Year 2 only, rather than Year 1 or the average?
And - do they look at your profits after expenses, or what you made minus what you then have to pay on it?

Any other ways people can think that I can raise the amount I can borrow? Its very hard in London to get enough money for a place.

Ciara

ACG

There are lenders who will work off latest years figures only, there are also some who will work off 2 years and a projection, so that would help your average out a little.

You will probably need a broker, but the figures you have mentioned seem achievable on the face of it.

goatelope16

Thanks very much. Do you know if the increase in rate for a lender to base it on Y2 only, would be worth it? It would give me more borrowing power but some people have said to me I will pay more interest if they only take year 2 figures, than if I provide returns for 2 years.

Mortgage_Adviser

Your situation is exactly of a type where you need a good broker.
It can be a difference of a lender taking our salary plus latest SE figures or Salary plus 50% of the average of the last two years.

amnblog

I've never heard of profits before expenses!

The self employed income figure will be the one on your tax calculation.