Getting a self-employed mortgage using latest income
If you’ve recently set up your own self-employed company, and your income is growing at a steady rate, then you may be looking to get a mortgage based off your records for the last financial year, as you feel this is an accurate reflection of your current affordability.
Lenders have become more and more flexible, occasionally viewing affordability on your latest income figures, and also allowing for flexible lending.
Who will look at my latest income?
There are specialist lenders in the market who will lend based on your latest income figures (net profit or salary and dividends, depending on if you’re self-employed or a partnership.)
These lenders will review your application if you’re looking to borrow on your latest figures, with just one year’s worth of accounts, or if you’ve recently changed to a limited company, with some even lending up to 90% loan-to-value (LTV.)
Why would I want to borrow based on my latest income?
If your business has improved and increased over the last year, your income will often be an indication of where the business is heading.
However, typically, lenders will look to valuate your affordability from an average figure worked out from the last two or three years of accounts, which may reduce the amount you can borrow.
If you are looking to borrow based on your latest income, you will generally be looking to borrow more than your average income figure would allow, which is why a specialist lender will be required.
For advice on getting a self-employed mortgage using your latest income, speak to one of our expert advisers who will be able to help you with the next steps.