Self employed mortgage declined

fedup12345

I’m comming up to my second years trading so technically going in with 1 years accounts but they have seen a lot more info and evidence from my second year (pay slips, bank statements) etc 

Deposit is £50,000
loan value is £80000
single 
no debt ccj 
first time buyer , renting right now 
no dependants 

yet I can’t get a mortgage the first lender my broker went with was Halifax and they rejected me after 3 months , leaving me in limbo that long when if anything was a issue they could have told us way earlier 

the First underwriter at Halifax actually said yes but then I changed address of the proeort and case got passed to a different one who said no. So it’s literally just different opinions 

only options now is sub prime until I get my 2nd year accounts sorted. The mortgage payments would have only been £360 a month Im just feeling like everything is against me

the reason the lender gave was that they weren’t happy that my second year earnings declined from my first but they don’t understand what I did to get my first year earnings (insomniac, workaholic) I changed my lifestyle in my second year and much healthier but obviously not put as many hours in. I feel they aren’t even looking at me as real person. I’m close to giving up is there any hope for me? I’m going through all this completely alone 

next lender he wants to apply to is Kensington 

dunstonh

the First underwriter at Halifax actually said yes but then I changed address of the proeort and case got passed to a different one who said no. So it’s literally just different opinions 

Or they changed their underwriting criteria in that period.   That often happens in periods leading up to a recession or financial crisis (and through it).  During the last one, lenders' underwriting criteria were changing weekly at certain points.

the reason the lender gave was that they weren’t happy that my second year earnings declined from my first but they don’t understand what I did to get my first year earnings (insomniac, workaholic) I changed my lifestyle in my second year and much healthier but obviously not put as many hours in.

Lenders like looking at trends and no matter which way you look at it, you are trending down. 

 I feel they aren’t even looking at me as real person.

They don't know you from Adam.  They just see someone that has very little track record and what exists shows a declining business during a period where failed businesses are expected to increase.

 is there any hope for me? I’m going through all this completely alone 

You say you are completely alone but you also say you have a broker.  So,  you are not alone.  The broker is there to give you the information, whether it is what you want to hear or not.

Is it actually sub-prime that is being looked at or near prime?  Kensington isn't necessarily sub-prime.

ACG

Halifax wont look at you as a person, they are too big and too busy. 
If you want a personal touch, you need a little building society. I think if your broker is also suggesting an adverse lender, you need a new broker. 

fedup12345

ACG said:

Halifax wont look at you as a person, they are too big and too busy. 
If you want a personal touch, you need a little building society. I think if your broker is also suggesting an adverse lender, you need a new broker. 

 my broker is suggesting Kensington but is pushing me to get the second year accounts then there will be more high street lenders. I’m scared no one will accept me not even an adverse lender 

fedup12345

dunstonh said:

the First underwriter at Halifax actually said yes but then I changed address of the proeort and case got passed to a different one who said no. So it’s literally just different opinions 

Or they changed their underwriting criteria in that period.   That often happens in periods leading up to a recession or financial crisis (and through it).  During the last one, lenders' underwriting criteria were changing weekly at certain points.

the reason the lender gave was that they weren’t happy that my second year earnings declined from my first but they don’t understand what I did to get my first year earnings (insomniac, workaholic) I changed my lifestyle in my second year and much healthier but obviously not put as many hours in.

Lenders like looking at trends and no matter which way you look at it, you are trending down. 

 I feel they aren’t even looking at me as real person.

They don't know you from Adam.  They just see someone that has very little track record and what exists shows a declining business during a period where failed businesses are expected to increase.

 is there any hope for me? I’m going through all this completely alone 

You say you are completely alone but you also say you have a broker.  So,  you are not alone.  The broker is there to give you the information, whether it is what you want to hear or not.

Is it actually sub-prime that is being looked at or near prime?  Kensington isn't necessarily sub-prime.

That’s fair enough but no self employed person has a track record who’s only been doing this 2 years, yet they say apparently self employed are welcome to apply even with just one years accounts. They wasted 3 month of my time going back and forth and I think ive Made the wrong choice because I don’t think anyone will accept me , not even sub prime I’m just feel king like I’m losing a losing battle. But I feel I’m to deep now to back away 

ACG

You can get a mortgage with one years accounts. 
Potentially normal lenders, potentially little building societies and failing those, the adverse lenders. 

I have no idea how many one years account mortgages I have done over the years, I am sure KS is the same and most experienced brokers. It seems like your current broker is the exception if they go from Halifax to Kensington. 

Call some brokers, have a chat with them. Move forward with one that fills you full of confidence. 

fedup12345

ACG said:

You can get a mortgage with one years accounts. 
Potentially normal lenders, potentially little building societies and failing those, the adverse lenders. 

I have no idea how many one years account mortgages I have done over the years, I am sure KS is the same and most experienced brokers. It seems like your current broker is the exception if they go from Halifax to Kensington. 

Call some brokers, have a chat with them. Move forward with one that fills you full of confidence. 

I have talked to a few brokers and told them the situation and they are telling me they wouldn’t do anything different so there is no point in swapping. Do you think my case is hopeless 

[Deleted User]

Not hopeless, you just need to speak to more brokers, be open and honest about all/any debts and keep at it.

When you chose to alter your lifestyle and your earnings dropped you made yourself a less attractive commercial risk.

Self employment isn't easy (i'm self employed) and anything that alters your earnings, in a downward trend, you will have to pay for with regards borrowing etc. etc.

Rethink your ideas/plans ..... you've seen what your earnings potential is with that previous years figures, follow that course for a few years, save all your hard earned money and use it to fund the lifestyle you're aiming towards.

Self employment requires a lot of discipline, it's definitely not for everyone, but if you've got that discipline it's the best way to earn a living 😊👍

simon_or

I think your broker's biggest crime was that he let it drag on for 3 months with Halifax with no backup plan.

I Googled current Halifax and Kensington rates and was pretty surprised that they aren't too far apart. 60% two year fix rates with no fee was 3.63% for the Halifax and 4.19% for Kensington ,not a huge difference in my eyes.

I've had my share of very adverse mortgages with similar lenders to Kensington and the rates differences were very high eg 4.5% Vs 1.5% with high street.

So if your broker can get you Kensington, perhaps worth trying. In 2 years you'll have enough accounts to remortgage to anyone you want.

fedup12345

simon_or said:

I think your broker's biggest crime was that he let it drag on for 3 months with Halifax with no backup plan.

I Googled current Halifax and Kensington rates and was pretty surprised that they aren't too far apart. 60% two year fix rates with no fee was 3.63% for the Halifax and 4.19% for Kensington ,not a huge difference in my eyes.

I've had my share of very adverse mortgages with similar lenders to Kensington and the rates differences were very high eg 4.5% Vs 1.5% with high street.

So if your broker can get you Kensington, perhaps worth trying. In 2 years you'll have enough accounts to remortgage to anyone you want.

I know , the application went in on 08/05/22 and look where I am. Nowhere. His back up plan was Kensington but he wanted to see what Halifax come back with . I don’t have the patience anymore and I don’t trust him because he chose the wrong lender for me from the get go hasnt he? I’m going with a self employment broker on Tuesday but I feel like no one will accept me 

[Deleted User]

I've just commented on your other thread.

Speak with several brokers - even the snotty ones you mentioned in your other thread - a lot of us have been in your situation (me included) you need to keep at it.

You already know that - being self employed means you're constantly 'at it' to get your business moving forward.

Don't lose hope, keep working with your broker or find the broker that can get you placed - give them every piece of financial fine detail they need, don't hold back on the bad bits, the more they have on you the better your chances.

I add that last sentence because sometimes our financial affairs are so bad we don't disclose them immediately, letting them peep out of the woodwork on an ;as and when' basis - this never works and wastes everyone's time in the long run.
Keep at it, save, save, save, your hard earned money and at least build up some extra pennies for the road ahead.