Mortgages for salaried partners
Whilst you may be paid a salary, you do not have any ownership of the business, nor do you have a share in the partnership’s distributions, despite bonuses being commonplace.
The fact that your income is slightly different to normal provides issues and concerns for some lenders, as they may misunderstand your situation, leading to an application being wrongfully declined.
Mortgages for equity partners
Obtaining a mortgage as an equity partner is difficult because some lenders won’t consider your application if you’ve been an equity partner for less than two years, and some may class you as self-employed.
As an equity partner, you’ll have ‘point’s or shares in a firm, which you can then draw from company profits. Normally this amounts to more than a typical base salary, which is why you may be classed as self-employed.
As such, lenders look to see two-three years’ of accounts and take an average of these figures to then work out your affordability.
This can become even more complicated if you work in a global firm and take some income in foreign currency. Some lenders won’t take this into account when calculating your afforfaibilty.
For advice on getting a mortgage as a salaried or equity partner, speak to one of our expert advisers who will be able to help you with the next steps.