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Self employed mortgage issues

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Me and my partner are currently applying for a mortgage through the shared ownership scheme, the lender has asked us for multiple different documents back and forth and we have 3 weeks left of our 6 week exchange deadline!! 

He was the director of a partnership company up until December 2023 when he resigned. He still works there as self employed but he isn’t the director anymore, he has his self assessment tax returns for the last 3 years. 

The mortgage lenders have asked now for the business accounts, however my partner’s accountant is saying he can’t provide these as my partner is no longer a director or shareholder in the business. Is this right? 
They’ve had all of his self assessments so I don’t see why they need the business accounts also and I’m worried that because the accountant won’t hand them over, that we won’t get the mortgage approved? 

Comments

  • ACG
    ACG Posts: 24,550 Forumite
    Part of the Furniture 10,000 Posts Name Dropper I've helped Parliament
    The accountant does not have to provide them. Infact legally he is not allowed to. It would be down to the owners of the company to provide them if they want to, but its purely optional. 

    You might struggle with this. As a broker, I am not sure I would have taken this on in all honesty. If you get it through you have done very well or got very lucky. 
    I am a Mortgage Adviser
    You should note that this site doesn't check my status as a mortgage adviser, so you need to take my word for it. This signature is here as I follow MSE's Mortgage Adviser Code of Conduct. Any posts on here are for information and discussion purposes only and shouldn't be seen as financial advice.
  • DullGreyGuy
    DullGreyGuy Posts: 18,613 Forumite
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    Me and my partner are currently applying for a mortgage through the shared ownership scheme, the lender has asked us for multiple different documents back and forth and we have 3 weeks left of our 6 week exchange deadline!! 

    He was the director of a partnership company up until December 2023 when he resigned. He still works there as self employed but he isn’t the director anymore, he has his self assessment tax returns for the last 3 years. 

    The mortgage lenders have asked now for the business accounts, however my partner’s accountant is saying he can’t provide these as my partner is no longer a director or shareholder in the business. Is this right? 
    They’ve had all of his self assessments so I don’t see why they need the business accounts also and I’m worried that because the accountant won’t hand them over, that we won’t get the mortgage approved? 
    If you have used the same language with the broker/mortgage provider you may have caused a lot of confusion as you've described it both as a partnership and a company which are legally distinct things. Someone resigning employment and then becoming "self employed" is also a big red flag as to if they are really a concealed employee. 

    It sounds like it's actually a company in which case their accounts are public record and you can download the latest ones from Companies House by entering the company name or number in https://find-and-update.company-information.service.gov.uk/ and going to Filing History. 
  • Sorry I’ve probably worded it abit wrong! 

    It is a limited company that he was 50/50 director of, however he has still always been classed as self employed and received dividends etc from the business which he has put through on his self assessment for the last 3 years. He has now resigned as the director but is still working at the company under self employment. 

    ACG said:
    The accountant does not have to provide them. Infact legally he is not allowed to. It would be down to the owners of the company to provide them if they want to, but its purely optional. 

    You might struggle with this. As a broker, I am not sure I would have taken this on in all honesty. If you get it through you have done very well or got very lucky. 
    Can I ask why you think it will be a struggle? Our mortgage advisor hasn’t shown any concern at all so now I’m worried
  • ACG
    ACG Posts: 24,550 Forumite
    Part of the Furniture 10,000 Posts Name Dropper I've helped Parliament
    Me and my partner are currently applying for a mortgage through the shared ownership scheme, the lender has asked us for multiple different documents back and forth and we have 3 weeks left of our 6 week exchange deadline!! 

    He was the director of a partnership company up until December 2023 when he resigned. He still works there as self employed but he isn’t the director anymore, he has his self assessment tax returns for the last 3 years. 

    The mortgage lenders have asked now for the business accounts, however my partner’s accountant is saying he can’t provide these as my partner is no longer a director or shareholder in the business. Is this right? 
    They’ve had all of his self assessments so I don’t see why they need the business accounts also and I’m worried that because the accountant won’t hand them over, that we won’t get the mortgage approved? 
    If you have used the same language with the broker/mortgage provider you may have caused a lot of confusion as you've described it both as a partnership and a company which are legally distinct things. Someone resigning employment and then becoming "self employed" is also a big red flag as to if they are really a concealed employee. 

    It sounds like it's actually a company in which case their accounts are public record and you can download the latest ones from Companies House by entering the company name or number in https://find-and-update.company-information.service.gov.uk/ and going to Filing History. 
    Those are not proper company accounts. Anyone can pull those documents, the lender would do that. 
    They want the full accounts. 
    I am a Mortgage Adviser
    You should note that this site doesn't check my status as a mortgage adviser, so you need to take my word for it. This signature is here as I follow MSE's Mortgage Adviser Code of Conduct. Any posts on here are for information and discussion purposes only and shouldn't be seen as financial advice.
  • amnblog
    amnblog Posts: 12,728 Forumite
    Part of the Furniture 10,000 Posts Name Dropper Photogenic
    edited 23 May 2024 at 1:16PM
    Your Partner was part owner (50%) of ABC Limited until 6 months ago.

    Now he is no longer part owner but works freelance as a self employed person on work given to him by ABC Limited?

    Is that about it?

    Can I hazard a guess that someone suggested he change his status for mortgage purposes?
    I am a Mortgage Broker

    You should note that this site doesn't check my status as a Mortgage Broker, so you need to take my word for it. This signature is here as I follow MSE's Mortgage Adviser Code of Conduct. Any posts on here are for information and discussion purposes only and shouldn't be seen as financial advice.
  • amnblog said:
    Your Partner was part owner (50%) of ABC Limited until 6 months ago.

    Now he is no longer part owner but works freelance as a self employed person on work given to him by ABC Limited?

    Is that about it?

    Can I hazard a guess that someone suggested he change his status for mortgage purposes?
    He is a barber self employed with his own shop, him and another barber made the business a limited company, 50/50. 

    They both still did self assessments etc. 

    My partner resigned as he didn’t want the hassle that came with running the shop and there wasn’t any financial gain so now just rents a chair instead. 
  • amnblog
    amnblog Posts: 12,728 Forumite
    Part of the Furniture 10,000 Posts Name Dropper Photogenic
    I can totally see why the the Lender wants info on the Company. 

    Like ACG I would expect this to get messy.

    If you are running a profitable and stable company why would you give up your share and keep working there? The Lender is trying to establish the reasoning here and establish there are not financial or personal issues that are going to tip the whole income source over.
    I am a Mortgage Broker

    You should note that this site doesn't check my status as a Mortgage Broker, so you need to take my word for it. This signature is here as I follow MSE's Mortgage Adviser Code of Conduct. Any posts on here are for information and discussion purposes only and shouldn't be seen as financial advice.
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