Mortgage company wanting 3 months bank statements

Browny0099

Hi

This my second time posting on here, everyone was very helpful the first time round so thought I'd give it another go!

I got a mortgage in principle today and the mortgage company have requested 3 months worth of bank statements.

We have a joint account and my partner runs her business from it so there's lots of transactions everyday. These range from PayPal payments (buying stock usually) to Royal mail transactions, Everytime she needs to buy postage its marked on the bank statement as a separate transaction, so if she needs to send 40 orders out, it'll leave 40 transactions to Royal mail for that day ranging from £0:60 - £2.25

Along with her business activity there's normal household bills and normal spending by myself (coffees at stations etc)

We do have a savings account which has the majority of our money in and tend to keep our main bank balance low (usually just enough in there for day to day stuff) I've never stopped to think why we do this, it's just something we've always done, I suppose it stops us from spending

Another issue I'm worried about is I had a bounced direct debit a month ago, i was meant to transfer £200 from savings but instead only transferred £20 meaning the direct debit bounced, I quickly phoned the companys, apologized and payed them. So on the statement it's shows me putting £20 in then £140 worth of direct debits come out and get returned. My fault I was half asleep when I was doing the transfer.

I've now suggested to my mortgage broker I spend a few months cleaning the statements up but the acceptance in principle is only valid for 30 days. Im worried the lender won't accept the statements as they are

Any advise would be much appreciated!

Thanks

Thrugelmir

At the very least your partner should run her business activity through a seperate bank account. Muddling personal and business income and spend is never a good idea.

Browny0099

Thrugelmir wrote: »

At the very least your partner should run her business activity through a seperate bank account. Muddling personal and business income and spend is never a good idea.

it's never really been an issue until now really. Im definitely looking into getting her a separate account though, there's about 120 pages for 3 months! Not good 😣

Thrugelmir

Browny0099 wrote: »

it's never really been an issue until now really.

If the HMRC ever come knocking.......... Random investigations can happen at any time.

BoGoF

At any point the bank may realise the account is being used for business purposes and close it.

Anyways, you have given yourself a headache mortgage wise. At the very least expect a good few questions.

[Deleted User]

I wouldnt expect the business use to be a huge issue. Sounds like partner is a sole trader so using personal account is legally fine and within bank policy. Just gets a bit messy for stuff like this.

The bounced direct debit sounds like an accident so again i doubt it would be an issue. Especially if you can evidence the account you tried to transfer from having more than the £20.

I doubt this would have any real problems when it hits the underwriters desk (assuming the rest of the case is solid enough)

minimike2

BoGoF wrote: »

At any point the bank may realise the account is being used for business purposes and close it.

Indeed.

She is almost certainly breaching the terms of the account.

Many people do this to avoid the charges of a business account, but the reality is that is a false economy.

Regardless of the mortgage, she should be looking to conduct her business banking via a business account.

[Deleted User]

I haven't worked in banking for a few years now but business usage for sole traders was always fine in a personal account.
This was due to the fact that there is no separation between personal and business income from hmrc perspective.
Maybe things have changed but it was always allowed in the many years I spent setting up personal and business accounts.

ACG

Why did the broker not have these before getting a DIP?!

If you do not apply now, you wont get the mortgage.
If you do apply now, you might get the mortgage. There are lenders who are more or less fussy about these things.

The business transactions I would not be worried about.
The bounced DD could be a bigger issue with some lenders.

csgohan4

minimike2 wrote: »

Indeed.

She is almost certainly breaching the terms of the account.

Many people do this to avoid the charges of a business account, but the reality is that is a false economy.

Regardless of the mortgage, she should be looking to conduct her business banking via a business account.

There are plenty of free business bank accounts now, Starling being one of them, which I switched to after closing my HSBC one

TiberUK

You applied for a DIP without even discussing basic things like bank statements? maybe you should find a different broker.

We had discussions with two brokers and a bank - the first thing all 3 (and one broker was an absolute disgrace) did was have a look at our payslips and statements