The couple who were self-employed had a mortgage with NatWest on their current property and planned to port their mortgage onto the new home and raise additional funds.
They had agreed to sell their property for £750,000 and were looking to purchase a new property for £1.1 million. With a mortgage already in place on their existing property for £300,000 and considering their estimated savings, they calculated they would need a mortgage of £880,000 for the purchase of their new home.
Although both clients had six-figure incomes, which would normally be sufficient to borrow the required amount, one had recently left their job as an accountant at a major accountancy firm in London to start their own business.
As they had only been trading for 14 months, they did not yet have 2 years of accounts. This meant that NatWest, along with many other mainstream lenders, were not prepared to lend to them, as most lenders require a minimum of 2 years of trading history.
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Despite not meeting the typical criteria of most lenders who offer standard “off the shelf” mortgages, it was evident that the clients had a strong track record of earnings and potential for future earnings.
We were fortunate enough to find a specialist lender who understood the complexities of certain self-employed incomes and was able to underwrite the application using just the 1 years self-employed income. They considered the length of time the client had been in the industry and accepted a projection for the second year of trading.
With their competitive rates, we were able to secure the mortgage, and the clients were able to move to their dream home in Surrey.
This story highlights the importance of shopping around and exploring various mortgage options. It is essential to not always accept the first answer and to look for specialist lenders who may better understand unique income scenarios.