Self employed mortgage advice: Is it possible to be approved for a mortgage with just one year self-employed accounts?
You’ll likely need to fit within some basic criteria which we’ve highlighted for you in this blog, but the process can be made a lot easier with the assistance of a mortgage advisor. An advisor has a greater understanding of the criteria needed by which lenders in the marketplace so can help guide you to a lender that would be suitable for your situation.
Firstly, if you have been working within your industry as an employed individual prior to setting up your business, then some lenders will look to this favourably when deciding upon your suitability. Your first year accounts may have a different year-end date to the HMRC self-assessment tax period. If that’s the case it may be possible to choose to work with the tax year period April – April, OR your company year depending what is more preferable for your circumstance.
If your company is registered as limited, the lenders that work from one year’s accounts will look at the director’s salary from the business alongside dividend income. If you are working from two years accounts some lenders will work off the company’s net profit and director’s salary instead of the dividend income and salary. This varies depending on the lending policy of each provider.
For a sole trader or partnership the lenders will assess you for affordability from the net profit of your accounts OR the self-assessments provided by the HMRC. Again you may be able to choose depending on what is more preferable for your circumstance.
With 1 year accounts you can get be granted a mortgage with a minimum of a 10% deposit and up to 4.75 times income multiples. A track record working within the industry is desirable and a lender may require an accountant certificate from a Chartered or Certified Accountant to provide a projection.
If you are looking to obtain a mortgage or remortgage with one or two years accounts, seeking self employed mortgage advice from a professional mortgage advisor will help you save time from making several enquiries to find a lender that will consider you, you’d probably save money too by ensuring you obtain the best deal for your situation. Contact us today to arrange a free no obligation