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    • SelfyEmployed
    • By SelfyEmployed 13th Jan 18, 2:14 PM
    • 1Posts
    • 1Thanks
    Self Employed - What Do I Need To Do To Get A Mortgage?
    • #1
    • 13th Jan 18, 2:14 PM
    Self Employed - What Do I Need To Do To Get A Mortgage? 13th Jan 18 at 2:14 PM
    I was wondering if anyone could give me their insight in what I need to do and where I need to get to in order to get a mortgage. I am self employed and have been for a number of years.

    This is some info:
    2015/2016 -Gross was 23k, Net was 14k
    2016/2017 - Gross was 25k Net was 0. This was 0 net because I chose to put all my profits back into the business in order to increase income.
    2017/2018 - By April should be around 65k Gross, 38k net
    For 2017/2018 tax year which is nearing its end. Until Oct I was putting all money back into business and now will start finally taking a proper wage from February onwards (January was my first drawings from it of 1000). I intend to give myself 4k a month.

    I am currently a sole trader but will be changing this to ltd for next year as the expected profits will be at least double what they were this year based on projections (around 80k profit) and what I have made in the last few momths including how january is going. I still intend to pay myself 4k a month though for the minute to keep my income consistent, even though there is potential to have a larger income.

    My income is such that I get paid in arrears - so I make money for a company then they pay me 2 months later for that. As a result I can see what I am getting paid 2 months before I get paid. My account shows over 30k income to be paid in the coming months. I thought I would add this here in case this could be handy information.

    Anyway ideally I would like a mortgage between 250k-300k. 300k would be better but I would settle for 250k. (I am under no illusions that I can afford that right now or that I can expect a mortgage right now). Where I live anything less would be a cluster home and I have lived in one of those before and could not do it again.

    I could have the option of moving to a cheaper area as my work doesn't require to me at a fixed location but there are reasons I want to stay here. I have an open mind though.

    I was wondering what sort of deposit I would need and how long until my accounts would be accepted as decent income to be considered for any type of mortgage. I know it is difficult to get one self employed so I am under no illusions that I will be given one tomorrow. I would be a first time buyer too so do not have any experience with the process, but wanted to get a general idea of what I need in order to be in a position to be offered a mortgage.

    Thanks for the help and reality check.
    Last edited by SelfyEmployed; 13-01-2018 at 2:50 PM.
Page 1
    • amnblog
    • By amnblog 13th Jan 18, 2:47 PM
    • 10,560 Posts
    • 4,174 Thanks
    • #2
    • 13th Jan 18, 2:47 PM
    • #2
    • 13th Jan 18, 2:47 PM
    You are making 38,000 profit, and say you would settle for 250,000 lending.

    You are not in the ball park. With the right advice you may get lending a little above 180,000.

    Speak to a Broker and then adjust your plans.
    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.
    • neneromanova
    • By neneromanova 13th Jan 18, 4:58 PM
    • 2,897 Posts
    • 6,865 Thanks
    • #3
    • 13th Jan 18, 4:58 PM
    • #3
    • 13th Jan 18, 4:58 PM
    We're in this same boa. Planning for our mortgage that we need but we're self employed so Obviously only pay ourselves a little as possible so that the tax bill is low.

    But you need to make your net as high as possible. Don't write things off just to 'lose' money. OH and I are looking at buying a 380k house and between us we have to earn 70k with a 60k deposit.

    I'v heard that a broker is the way to go for self employed people though as they understand what we do and help.
    DD1 Born 31st March 2008
    DD2 Born 29th August 2010
    DS1 Born 28th October 2013
    Got Married 15th September 2012 Now Mrs Clark

    • diddy_d
    • By diddy_d 13th Jan 18, 11:27 PM
    • 11 Posts
    • 2 Thanks
    • #4
    • 13th Jan 18, 11:27 PM
    • #4
    • 13th Jan 18, 11:27 PM
    Try a contractor broker - SuperContractor is one I've come across recently. They specialise in Contractors but might be able to help you - I've not used this particular one but they don't charge the customer a fee so worth having a chat IMO (I'll be using them next time)
    • Thrugelmir
    • By Thrugelmir 16th Jan 18, 5:07 PM
    • 58,934 Posts
    • 52,257 Thanks
    • #5
    • 16th Jan 18, 5:07 PM
    • #5
    • 16th Jan 18, 5:07 PM
    Don't write things off just to 'lose' money.
    Originally posted by neneromanova
    Tax planning needs to be undertaken properly. You can claim expenses which are wholly and exclusively incurred for the purposes of the business. The HMRC holds plenty of statistical data to identify accounts which are out of kilter with the "norm".
    Financial disasters happen when the last person who can remember what went wrong last time has left the building.
    • BoGoF
    • By BoGoF 16th Jan 18, 6:30 PM
    • 3,215 Posts
    • 2,532 Thanks
    • #6
    • 16th Jan 18, 6:30 PM
    • #6
    • 16th Jan 18, 6:30 PM
    Can you explain what you mean for 16/17 - you say you put all profits back into the business meaning zero profit. Was this capital expenditure?
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