First time buyer with a monster headache...

ImGettingThere

Hey everyone! 
I would really love some input and somewhere to voice my thoughts/concerns.
My partner and I are looking into purchasing our first home. I'm self-employed with healthy accounts but old defaults and she's employed with a clear credit score and a decent, regular income. 

We've been to a mortgage broker who's basically said we could borrow up to £160,000 which for a home in Hampshire is basically a non-starter (Rightmove has a boat for sale... that's basically it) 
The issue is when we look at schemes like shared ownership, somehow it's acceptable for us to have a £100,000 + mortgage and payout up to £600 rent PCM plus service charges, etc. which FAR outway the cost of a mortgage of even say, £250,000 which we could purchase a home for easily!

My mind is baffled at how, affordability wise, we can't get a shoebox in the middle of the road yet, it's perfectly acceptable to hit us with heavy rent premiums?
Is there some magic mortgage broker who could get us a better loan amount so we could actually buy our own home? How do we know which is the best one to go for? 
My credit file is 100% an Achilles heel in this which is why it's really important to me that we don't perform a hard search and get a poor offer and really screw our chances of owning a home. The rental market just makes my heart sink and relocating whilst, I'd be game, doesn't work for our plans of starting a family, etc! 

Any and all advice gladly received - even if I just need to swallow my pride on shared ownership. I just don't want to start my family off in a bad way! 

britishbug

I’m so sorry to hear this, have you used an online affordability calculators? most high street banks do them without touching your credit score. It’ll be good to know if it’s in the ball park of what your broker has advised or not. 

ImGettingThere

I did google 'self-employed mortgages' and it came up as £220,000 which would be a fantastic figure to play with. My dad is in refurbishment/maintenance so, we have a direct line to trade goods at trade prices so, a bit of a fixer-upper is fine with me. 

It's just hard to know if this £220,000 figure is a carrot being dangled before being snatched away you know? 

D.L

Have you considered doubling your salary?

ACG

Has the self employed income jumped? If so, you may need a lender who will work off latest years figures rather than an average of the last 2 years? 

Try another broker, get a second opinion. 

ImGettingThere

The income has jumped actually! Quite a bit.
By around 35% from 2018 to 2019 and I'm on target to jump around 40% from 2019s figures to this year although, I won't be able to file a tax return on that till April next year.

ACG

Sounds like that is where your broker is going wrong then. 
I dont think you need a magic mortgage broker, just one who is maybe a little more experienced.

[Deleted User]

ImGettingThere said:

The income has jumped actually! Quite a bit.
By around 35% from 2018 to 2019 and I'm on target to jump around 40% from 2019s figures to this year although, I won't be able to file a tax return on that till April next year.

If you are talking about figures for April 2019 to April 2020 being 40% more ? Then surely you could file your return on 6th April 2020 so that would be your most recent figures ? 

ImGettingThere

Densol said:

ImGettingThere said:

The income has jumped actually! Quite a bit.
By around 35% from 2018 to 2019 and I'm on target to jump around 40% from 2019s figures to this year although, I won't be able to file a tax return on that till April next year.

If you are talking about figures for April 2019 to April 2020 being 40% more ? Then surely you could file your return on 6th April 2020 so that would be your most recent figures ? 

My bad on this - so, in April I'll be submitting my return early to get an SA302 on figures from April 2019 to April 2020 but the 40% jump is what's coming in this year so, it'll be my 2021 tax return that I show that. Sorry for the slip up my end. 

I appreciate the easiest answer may be just wait till April 2021 and then go from there but even based on the tax return coming up in just under a month has a big jump and I'd love to work on those figures soley rather than an average as 2018 was a year of heavy investing for me so, profits came down accordingly.

haras_n0sirrah

Some lenders will work off latest but they will want an explanation for a large jump in profits. I had one where a client had a big jump and the lender (who usually works off latest) wanted to average it. We got a letter from the accountant confirming why there was a big jump and that it was sustainable (I.e. not just to get the mortgage) and they accepted latest year. 

LRmortgage

If you post some basic income and commitment figures here, we’ll be able to let you know if your broker is in the ballpark.