First time buyers..

Dace2020

Me and my partner are hoping to get a mortgage for our first house by the end of the year. We have a deposit however the mortgage part is the confusing bit!

So... He has been a sole trader since 2013 but now has a Ltd. business. He wouldn’t have been trading under his Ltd business for a year by the time we get the mortgage. Is this going to cause chaos?

I’m employed by the NHS so my part should be a little easier.

We are hoping to get a mortgage broker to help us secure.. but again not sure if they will advise us on what we need to do, or we need to come prepared.

Thanks I’m advance 😊

ACG

Generally speaking lenders will be ok with 1 year as a limited company and 1 year sole trading. Can he not remain as a sole trader for another year?

It will make your life a lot easier if he can.

Dace2020

Thank you for your reply. We will be filing another tax return under the sole trader this April..

Would you be able to explain or advise on how it’s easier? I was under the assumption Ltd. business are preferred?

Thanks again!

ACG

Makes no odds whether it is sole trader or limited.
The problem you have is when you have 1 year as a sole trader and 1 year limited, strictly speaking they are 2 different businesses, the sole trader is your partner, the limited company is its own legal entity. There are lenders who will accept 1 year as each where the reason for change was tax purposes, but it just makes everything a little more complex.

Dace2020

Perfect t makes loads of sense. He does have a few years sole trader but previous years he didn’t earn as much.

Do you know if this is something a mortgage broker can help with? Or do we need to come prepared with everything when looking for one?

Thanks again.

ACG

Lenders are usually only interested in the last 2 years.

Speak to a broker, they will tell you what you need and take control of it all so you dont need to worry or stress about it.