Mortgages for company directors
Be assured that there absolutely are lenders out there who offer mortgages to limited company directors. A few of the big high-street names are moving in the right direction with regard to this type of lending, but it is typically in the smaller, more niche corners of the lending market that you will find the most flexibility in assessing directors’ income. When you start looking for a mortgage, however, it is important to bear in mind that application criteria can vary quite considerably between different lenders, with regard to factors such as how they will calculate your income figure for the purposes of affordability assessment and working out how much you can borrow.
As a general rule, lenders will expect your company to have been trading for at least a year before you apply for a mortgage. Some lenders may make exceptions for certain professionals (such as doctors) who have been operating as a limited company for less than a year, but this would normally only be considered where a contract can be used as evidence of ongoing and future income.
Lenders will typically want to see your company accounts covering at least one full tax year. It is not uncommon to be asked to provide more than that – two or three years’ worth. In some cases – where your company’s accounting year does not run April to April and therefore your first tax return doesn’t cover a full trading year – lenders may be willing to look at a 12-month “snapshot” of your accounts rather than making you wait until the next tax year end before applying.