Anyone recently got a mortgage self employed?

llihl13 · 2023-03-23T11:19:13+00:00

My house sale recently fell through as my original buyer pulled out. I’ve now got a new offer from a young couple who seem really keen, although he’s a self employed plumber and only started his books in September 2021. I believe she qualified as an accountant in 2021. I‘ve accepted their offer but to be honest I’m worried about them being approved for a mortgage if he’s self employed, especially after the sale falling through once already AND the face interest rates are due to rise again. The agent has told me they’ve got an agreement in principle but I’m aware this doesn’t mean much. Has anyone recently got a mortgage being self employed? Or does anyone have any advice on what they would do here?

Outnumbered99 · 23/03/2023 12:06

I can see why you would be concerned but you don't know their financial position- they might have a large deposit (family gift, inheritance) or not need to use his income for the mortgage application.
What have they/the agent said to allay your fears? have they instructed solicitors swiftly, got their full mortgage application in? Are they using a broker- they can provide (some) updates to the agent

Original poster

llihl13 · 23/03/2023 12:13

Outnumbered99 · 23/03/2023 12:06

I can see why you would be concerned but you don't know their financial position- they might have a large deposit (family gift, inheritance) or not need to use his income for the mortgage application.
What have they/the agent said to allay your fears? have they instructed solicitors swiftly, got their full mortgage application in? Are they using a broker- they can provide (some) updates to the agent

As far as I know they don’t have a large deposit, the agent usually tells me if they do. I know they are definitely using his salary for the mortgage as the agent mentioned them waiting until the new tax year to do the application.

The agent has said they have instructed their solicitor, memo of sale should be sent out in the coming days. They supposedly also have an appointment with their MA to do their mortgage application early next week. So. I guess all I can do is wait?

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EstherHazy · 23/03/2023 12:18

I can't say much about self-employed - it's a very common situation in the UK so there are loads of mortgages available but it's just taken more on an individual basis depending on their area of work/risk to volatility in income etc. But what I can say for sure is the accountant on the other side of the equation is really good news - qualified accountants are eligible for 'professional' mortgages that allow a higher multiplier on their income than average, so this will hopefully help balance things out.

kirinm · 23/03/2023 12:35

If they're waiting for the new tax year, he will have two years accounts which is what he needs.

My DP is self employed and other than needing to produce SA302s, it's a pretty straight forward process.

kirinm · 23/03/2023 12:36

EstherHazy · 23/03/2023 12:18

I can't say much about self-employed - it's a very common situation in the UK so there are loads of mortgages available but it's just taken more on an individual basis depending on their area of work/risk to volatility in income etc. But what I can say for sure is the accountant on the other side of the equation is really good news - qualified accountants are eligible for 'professional' mortgages that allow a higher multiplier on their income than average, so this will hopefully help balance things out.

Only if they earn over a certain amount I think.

Original poster

llihl13 · 23/03/2023 12:42

kirinm · 23/03/2023 12:35

If they're waiting for the new tax year, he will have two years accounts which is what he needs.

My DP is self employed and other than needing to produce SA302s, it's a pretty straight forward process.

I think he only went self employed in September 2021 though, so wouldn’t that still only make it 19 months?

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alwayscheery · 23/03/2023 12:45

Barclays would be a proceed-able mortgage application.
Depending on their loan to value.

mightymam · 23/03/2023 12:46

My husband was a contractor and had been in several roles covering maternity, sickness, etc. over a two year period. It took 6 LOOOONG months for us to go from AIP to actual mortgage offer, after which we completed within a fortnight! This was in 2022 and I began losing hair from the stress of it all but it did happen! I thank our vendors for staying patient and trusting us. It was really, really stressful and this was before the world went mad. I'd be very honest with the couple and say that you're worried and do they have a plan B. In our case, the mortgage company was waiting to see if my husband's role would be renewed or if he would move elsewhere. He got another job at a higher salary point after which, the bank made their offer. It works out in the end.

Original poster

llihl13 · 23/03/2023 13:42

mightymam · 23/03/2023 12:46

My husband was a contractor and had been in several roles covering maternity, sickness, etc. over a two year period. It took 6 LOOOONG months for us to go from AIP to actual mortgage offer, after which we completed within a fortnight! This was in 2022 and I began losing hair from the stress of it all but it did happen! I thank our vendors for staying patient and trusting us. It was really, really stressful and this was before the world went mad. I'd be very honest with the couple and say that you're worried and do they have a plan B. In our case, the mortgage company was waiting to see if my husband's role would be renewed or if he would move elsewhere. He got another job at a higher salary point after which, the bank made their offer. It works out in the end.

Wow, 6 months! I don’t think the developer I’m buying my new build from will wait around that long haha.

Unfortunately I don’t have direct contact with the buyers, have been strongly advised against it by the estate agent after I made that mistake last time haha. I will just have to manage expectations through the EA :/

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mumarooni · 23/03/2023 22:09

As far as I know the 19months doesn't matter, because the key thing is he will have two years of tax returns to show. The problem will be the first year won't show much earnings in it, but a good broker should be able to find a lender who takes the more recent year into account. I'm not speaking from any real experience though, just currently at a similar stage of waiting for new tax year to submit an application due to fluctuating selfemployed earnings (in our case, based on having kids the year before)

Crikeyalmighty · 23/03/2023 23:34

The annoying thing is the fact it can be a right hoo ha getting a mortgage self employed these days.anyone'employed' can lose their job , so why should it be ok if you've been in a salaried job say 4 months , but a right hoo ha if you've been self employed a few years say. (And it is)

whereeverilaymycat · 24/03/2023 11:21

Crikeyalmighty · 23/03/2023 23:34

The annoying thing is the fact it can be a right hoo ha getting a mortgage self employed these days.anyone'employed' can lose their job , so why should it be ok if you've been in a salaried job say 4 months , but a right hoo ha if you've been self employed a few years say. (And it is)

Agree. The whole job for life thing has long been history so it seems a bit harsh to me.

Original poster

llihl13 · 24/03/2023 13:02

Update - I’ve just received the memo of sale and it is only her name on the document. I don’t think she could afford to buy the property on her own salary (she’d have to be earning a lot and she’s only recently qualified). What could be going on here?

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Meandfour · 24/03/2023 13:04

Second this; dead easy to produce SA302s for mortgage.
Many of our subbies have gotten mortgages with no problem. One of the labourers got a mortgage just last month.

Meandfour · 24/03/2023 13:06

llihl13 · 24/03/2023 13:02

Update - I’ve just received the memo of sale and it is only her name on the document. I don’t think she could afford to buy the property on her own salary (she’d have to be earning a lot and she’s only recently qualified). What could be going on here?

You don’t think or you know she can’t?

Original poster

llihl13 · 24/03/2023 13:07

Meandfour · 24/03/2023 13:06

You don’t think or you know she can’t?

Show quote history

I don’t know for a fact, but when they came for the viewing I heard them saying they wanted to wait for the new tax year to submit their mortgage because he’s self employed. So it doesn’t sound like she’s doing it solo…

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Outnumbered99 · 24/03/2023 13:14

Any money in the family- might have a loan from the bank of mum and dad, lots of possible scenarios all perfectly above board, i would try not to worry too much

PleaseJustText · 24/03/2023 17:28

She could have a lot of family money behind her. I have a friend who could afford to buy his very expensive house outright and still have enough to live on for the rest of his life. He got a mortgage because the interest he paid on the mortgage was less than interest he earned by investing his own money elsewhere.

I do think the barriers for self employed tradesmen are silly. A plumber is in a high demand job. No matter what happens in the world, people will still need them. My salaried job on the other hand... well, i think I'm far more likely to be made redundant. I have skills but with a lot less training, anyone could do my job.