Best mortgages for part self employed?

[LemonSwan]

Went with HSBC, mortgage offer has come in 45k under DIP and 30k under what we wanted to borrow.

The issue is we delayed starting to pay ourselves directors salary from March to September last year due to covid. We were a new company so not eligible for support, we didnt need the money and we wanted to protect the assets of the company and ensure any salaries were 100% sustainable. Luckily we had a great year and our retained earnings are healthy and salaries covered by incoming work. Already in profit by nearly 10k in the first quarter this year.

I have now gone to a broker and fingers crossed they can find us something extra, but they cant start until next week and deep down I am panicking.

We can still buy the house. Its not a disaster, but we wanted to use that money for work on the property and its going to be very uncomfortable for a year or so without these funds (single glazing, needs new bathroom and no central heating).

Any tips, recommendations or stories from other self employed out there?

@LemonSwan

Went with HSBC, mortgage offer has come in 45k under DIP and 30k under what we wanted to borrow.

The issue is we delayed starting to pay ourselves directors salary from March to September last year due to covid. We were a new company so not eligible for support, we didnt need the money and we wanted to protect the assets of the company and ensure any salaries were 100% sustainable. Luckily we had a great year and our retained earnings are healthy and salaries covered by incoming work. Already in profit by nearly 10k in the first quarter this year.

I have now gone to a broker and fingers crossed they can find us something extra, but they cant start until next week and deep down I am panicking.

We can still buy the house. Its not a disaster, but we wanted to use that money for work on the property and its going to be very uncomfortable for a year or so without these funds (single glazing, needs new bathroom and no central heating).

Any tips, recommendations or stories from other self employed out there?

I have some advice @LemonSwan !

https://www.mumsnet.com/Talk/legalmoneyy_matters

Thanks @ginuwine

The link is just sending to home page of Money Matters. Would love to read your advice

See what the mortgage broker says before panicking - my ex was partly self employed when we bought our house and the mortgage broker was excellent, we were able to borrow what we wanted

Thanks Cabdury

On the surface I am staying calm because DP will have an anxiety attack otherwise but under the surface I am screaming AHHHHHHHHHHHHHH!

Its so annoying. We have been penalised for having the companies best interests at heart. The advisor and underwriter seemed annoyed. We have been penalised for being sensible business owners and they would have offered more if we had rinsed the company dry and had 0 in the bank.

No wonder so many had to take bailouts in covid. Its madness people are encouraged to run their companies that way.

@LemonSwan

Thanks Cabdury

On the surface I am staying calm because DP will have an anxiety attack otherwise but under the surface I am screaming AHHHHHHHHHHHHHH!

Its so annoying. We have been penalised for having the companies best interests at heart. The advisor and underwriter seemed annoyed. We have been penalised for being sensible business owners and they would have offered more if we had rinsed the company dry and had 0 in the bank.

No wonder so many had to take bailouts in covid. Its madness people are encouraged to run their companies that way.

You and the company are separate legal entities. You are not “self employed” by the way, you are an employee of the company - self employed is something else entirely.

What is held in the companies bank account is not relevant to any lending decision as you and it are separate legal entities, the company could not be forced to pay your mortgage for example.

I get what you are saying @Aprilx - that is how everyone else views it but the underwriters don't see it that way. Apparently we are not 'employed' like any other employment. Hence the averaging of salaries over years as opposed to the last 3 months payslips for employees.

And yes it is a separate legal entity, but we control it 100% so if we want to pay ourselves x to pay the mortgage then we obviously can. Hence why they take Ltd Profits on a multiplier like any other income.