Being self employed and wanting a mortgage

[Keeley20]

hi everyone just wanting some advice really.

Me and my boyfriend are currently saving a deposit for a house. Im self employed (my salon has been open 6months) and im just covering costs etc. Things are picking up and futures looking good but what i really want to know is how hard is it to get a mortgage when your self employed?

What things do you need before you can apply? Iv been researching and it says i have to have two years tax return and proof of income. I dont have any of these...what do i do :sad: xxx

not looking to move out for another year or two but need some more info x

 

[Becki2003]

Hi, if I remember correctly (I'm FPC qualified but not licensed to be a financial adviser so you're better off going to see an independent mortgage adviser they are free usually) you do have to have at least 2 years tax returns plus your accounts to prove your income and I do believe the criteria is getting tougher. Your alternative is to just use your fellas income and not have yours taken into consideration at all. Its likely to mean a smaller mortgage but it's a way of doing it if you're not able to prove your income. I've been self employed for many years and when I was married my income fluctuated that much that we just bought our house on my ex's wages alone but now I'm back to renting. I'm sure someone who is more clued up or has done it will be better placed to advise you. Like I said I'm not an IFA haven't been since 2005. Good luck with whatever you decided to do xx

 

[Keeley20]

hi thanks so much for your reply
So i will be doing my first tax return in april and then one the following april would this be alright??

We are going to see a mortgage adviser in a few months just gonna save like crazy untill then. thanks for your help xx

 

[Becki2003]

To be honest, I don't know what will be enough anymore. Your best bet is to ask an independent mortgage consultant. They will be able to tell you exactly what you need to do and what mortgage product is best for you. I wouldn't bother with your bank mortgage advisor for general advice as they are usually tied to the banks products but an independent will have access to a wide range of products.

 

[johnworf]

all banks are different - some are easier to get mortgages with than others. Also can you ask the bank you have an account with - should be easier.
Don't forget these people are on commission so they want to get you a mortgage as that is how they make money.
Basically they will look at your joint income and times it by about 3 and that's basically what you can get. Do you have kids or anything then you can claim WFTC.
Good luck.
Try this website for self certified mortgages...
Self Cert Mortgage Centre | No Proof Of Income Mortgages UK
I've no allegiance with them...but it might give you a few ideas.

 

[Prettyflamingo]

Hey there just want to re-open this thread , I'm employed but my boyfriend is self employed , we were in Australia for 2 and a half years , prior to this he was self employed for 2 years , and since we have been back ( march 2011) he has been self employed , im wondering whether this would be taken into consideration ? If not , what is a self certified mortgage? Thanks !

 

[ttaylor]

Hi I thought I would help out here as I'm doin it all my self at the mo. I have been self employed for 14 months now and thought there was no hope as my fellas credit rating is a no go. We went to see a mortgage advisor ad banks for advice (don't bother with independent mortgage advisor go to somewhere like connells they are great and do same thing for free) basically I think we got in there just in time. Yes they want at least 2 to 3 years accounts and 1 year projected, however because I had gone self employed in the same job and same salon they saw it as just a change in the way I get paid. However I don't think tho is the case anymore as some criteria changed in march And they are getting strict. We have been lucky as we have a massive deposit and saw the banks and people before so they have been able to rational it knowing my circumstances. My honest advice is go see them work out a plan on what you can do and what is realistic. And save that deposit like crazy!! They see us self employed as a big risk and those are the mortgages they are cracking down on. We have had go through our whole expenditure to make sure we will be able to afford repayments in 5 years!!! Good luck and hope it all works out xx

 

[Prettyflamingo]

Hey there thanks so much for that, it's just so annoying , employed or self employed doesn't mean anything is secure in my eyes , were all at risk to some extent ..grrr!!! Thankyou so much for your advice though I shall do some delving !! X x

 

[KGsalon]

Hi,

Im going through this at the moment.
In the middle of buying a house and its been nothing but a nightmare.

I have 3 years accounts and proven 2 years wages but keep getting turned down as its still classed as a risk.
We have a huge deposit and they are still not interested.
There are companies that will give the money to you but will have a much bigger interest rate.
Most mortgage companies will times your incomes by 4 and thats what you can borrow.
x

 

[nixnewcastle]

I've just been accepted for a mortgage and they used only my last years worth of accounts as anything before that was a waste of time with me using every penny I earned to invest back into the business.

We've also had to put in a 15% deposit as 10% was bringing in rubbish interest rates and a lot of lenders are now asking for 15% deposit so we had more options. Hope that helps

 

[ttaylor]

Hi,

Im going through this at the moment.
In the middle of buying a house and its been nothing but a nightmare.

I have 3 years accounts and proven 2 years wages but keep getting turned down as its still classed as a risk.
We have a huge deposit and they are still not interested.
There are companies that will give the money to you but will have a much bigger interest rate.
Most mortgage companies will times your incomes by 4 and thats what you can borrow.
x

That's Rubbish surely as you have 3 years accounts that is what they are all asking for? As I said we first went to an advisor at Conells estate agents an they helped us find who would consider us, turns out its Halifax who seem to take in most case that other banks won't. As for deposit it is going up an currently yea it's 15% for the better rates.
Don't give up keep pestering them xx

 

[topcuts]

hi. i dont hold alot of hope for you im afraid unless your oh earns a good stable wage.

i had to buy my ex out of my house in 2009 and had been self employed for 18 months, thankfully things were easy then, my mortgage advisor was amazing and just put a random figure down for me as she said she knew how much hairdressers earn (i certainly wasnt at that time but didnt argue) and i got my house/mortgage just in time

nowadays its hard hard hard and my accountant did my tax return last month (yes ahead of time) and told me i wouldnt be able to move which i knew, which suits me cos my oh wants to move and i dont haha

good luck oh and you should have a tax return for every trading year?

 

[Prettyflamingo]

Thankyou I don't hold much hope for myself !! It will be 2014 till we will be considered , looks like we will just have to rent , the rest of europe do !!! X

 

[HairByCharlotte]

Have you thought about having a guarantoored mortgage? This is where a parent steps in if payments cannot be made (unlikely but it's better for the mortgage company) and they often dismiss your wages. Me and my partner are in the middle of sorting it all out now. Weve both only been self employed 8months but I'm lucky as my dad has agreed to be guarantor and had no mortgage himself as he has paid it off. We had to get an 85% mortgage tho so can only have a tiny hous e/maisonettes but it's a start!

 

[Prettyflamingo]

Oo that sounds quite good , how did u find out about that ? X

 

[HairByCharlotte]

Best thing to do it use a mortgage advisor they are so helpful and and free! (fees added onto mortgage upon completion) ask them about it and obviously if one of your parents is willing and how old they are. Eg I can only get a mortgage fixed for 22 years as that's when my dad will be 70. Bit after 2 years (depending on how long your fixed interest rate is) it gets reviewed and you'll more than Likely be able to take it over yourself anyway x