Company directors ultimate guide to getting the best mortgage

Owning a company can be hard enough, being pulled in all directions, staff management, cash flow, accounting, not to mention doing your day job at the same time! So, it’s unlikely you’re going to have the time and energy to research getting the best mortgage for yourself.

This blog will point you in the right direction and let you know some things you probably weren’t aware of when it comes to getting the best mortgage as a company director.
Let’s start with timings, most lenders (I’m going to say most quite often throughout this because there are always some exceptions) will only use figures that are less than 18 months old. So, there are some key dates to think about. If you are using tax year income you only have until October the following year before you need to update your accounts. This is a few months before you are required to do it by HMRC but if you want a mortgage you need to do it early. Some lenders though, will use your trading year, so that time will obviously vary but the same 18-month rule usually applies.

How many years’ accounts do you need?

There can be confusion around how many years accounts you need to get a mortgage. Some directors think that three years are needed and, whilst there may be the odd specialist lender that might like that, the normal requirement is only 2 years.

There are two main types of lenders we need to think about next; those that take your salary and dividends and those that take your profits into account when assessing how much you can borrow. Let’s think about salary and dividends first. For most people I speak to, they assume that this is the only option, but the truth is far from it! Most lenders will average your last two years income or if your income has gone down, they will use the latest. There is at least one mainstream lender though, that will just use your latest year of income so if you have taken more income in the most recent year, that can make quite a big difference for you verses averaging the last two.

There are some other lenders that will look at your profits and from experience, not many company directors expect to be able to use their company profit, but it is possible. There are also a few lenders that will look at the salary you have paid yourself plus the net profit of the business. This works well if you pay yourself what you need each year but leave extra money in your business. Afterall, if you take it out you have to pay personal tax on the income. Lots of directors are in this position, where there is money being left in the business and lenders won’t lend them what they require.

So, with this in mind you could use a different lender that would consider your net profit, it is there if you wanted to take it out, so it makes sense to use it. There is also a lender that will use the gross profit so that can make a really a massive difference compared to your salary and dividend a lot of the time. There can be a massive difference in what each lender will lend you when you own your own company. The gap isn’t often as big for sole traders or employees, so it is particularly important for company directors to get proper advice from a qualified expert.

Do ensure that you seek advice from a reputable, qualified mortgage broker and make sure they are familiar with the big differences between different lenders and are able to talk to you about your options.

With these different options available, you may be interested in getting some ideas about your true affordability. To do this you will need a few different figures; your tax year salary and dividends, your trading year salary and dividends as well as your trading year net profit, all for the last 2 years. That sounds quite a lot of information to gather but you can usually get your accountant to provide you with those numbers. It doesn’t need to be as complex as it might sound.

I hope you have found this blog useful and hopefully it will be the difference for you like so many others, between the mortgage you want and the mortgage you think you might get.

If you have any questions or want to arrange a completely free strategy call with us to plan out your affordability, click here to go straight to our calendar and book a time to suit you. Or alternatively call us on 0300 124 5630 and we’ll happy answer your questions.

The latest from Instagram

An extra gift in your Christmas shopping could mean the world to a child or young person this year.

We know that many more people will find this Christmas harder financially so more children could go without.

We've been in touch with the Salvation Army to collect gifts on their behalf. We will then drop them off to the Banbury centre who will distribute them locally this Christmas.

Unwrapped gifts must be with us by Friday 10th December. They are in particular need of gifts suitable for 16-18 year olds, things like; games, gloves, socks, toiletries, mugs, bags, stationary, headphones etc.

THANK YOU to everyone who has dropped something in so far - you're amazing!
...

Black glasses for Black Friday ⚫️🤓

So, #blackfriday

Love it or hate it?

Personally I can't stand it. It seems to me it brings out the worst in some people, all trying to get something bigger or better. I remember the scenes on the first black Friday a few years ago. People literally hurting each other to get to a product off the shelves.

I wonder if they still have those items now?

It is my belief that we should always be savvy about getting the very best out of our money, every day of the year.

When remortgaging you might ask yourself, is it worth the hassle of moving lenders?

The answer is YES.

In fact, a saving of just 0.5% on a mortgage of £250,000 would be around £62 per month difference. That is about £3720 over a 5 year fixed term!* A substantial amount that you could and would probably want to put to better use.

I believe this to be a better way of getting good value for money and thinking about your future. Rather than buying something on a whim just because it's Black Friday.

So today, on Black Friday, check when your mortgage rate comes to an end and get in touch to see if I could find you a better fit.

*Figures based on a mortgage of £250,000 over 25 years at 1.5% verses 2% to the nearest whole pound.

**Your home may be repossessed if you do not keep up repayments on your mortgage.
Our typical fee for arranging a mortgage is £500 but this may vary on the complexity of your individual case.
...

If you're thinking of a move next year, any time next year, just be warned it could be a busy one.

Many moves and plans have been put on hold since the pandemic started. I predict that next year is going to be a recovery year. Recovery for our families, our plans and our searches for the next perfect home.

If this is you, I urge you to put in some of the background work now so that when you think you're ready, you're already on the right track. One step ahead.

One of the very first things you can do is get an up to date valuation of your home. If you're local to north Oxfordshire, my agency Maxwells Estate Agent can help you with this - at your pace.

If you're not local, I can help you with a remote valuation to get you started and can recommend estate agents best suited to you and your home.

Get in touch 01295 981300

**Your home may be repossessed if you do not keep up repayments on your mortgage.
Our typical fee for arranging a mortgage is £500 but this may vary on the complexity of your individual case.
...

Next year is going to be a BIG year.

I'm actually obsessed with looking forward. So much so, Julie often tells me that I need to slow down and take in what's going on right now and be more present.

Which is why we make such a good team I guess. Her yogi outlook on life and my dreamer head.

But my brain isn't wired that way - I'm always planning, considering, thinking about what the next challenge is going to be.

I've got so much planned for my businesses (stay tuned) and for my family (that might actually be more Julie's doing) in 2022.

Next year will be a big year for many of my clients too as many of them are going to come to the end of their fixed rate. There will be more conversations about home improvements, projects, moving plans and more. I can't wait to start helping them on putting their plans into action.

Check if your mortgage rate is coming to an end next year. If it is, start thinking about what your plans are. Is it to pay off a lump sum, is it to get working on that extension or finally convert the loft into a home office?

Whatever your plans, consider how you might make them a reality.

Take a look at my blog for more on remortgaging next year - link in the bio.

**Your home may be repossessed if you do not keep up repayments on your mortgage.
Our typical fee for arranging a mortgage is £500 but this may vary on the complexity of your individual case.
...

Refer a friend to us at Vantage Mortgages and receive a £50 Amazon voucher - that would be nice for some Christmas shopping right?! 🛍 📦
🌲
🎅 There is no limit to how many people you refer - £50 for each referral.
🌲
🎅 You'll receive your voucher when your friend submits their mortgage application.
🌲
Do you know someone who would benefit from our expertise? Tag them!
🌲
*Your home may be repossessed if you do not keep up repayments on your mortgage. Our typical fee for arranging a mortgage is £500.
...

Some children will struggle to be given much at all this Christmas.
.
We are opening up our office as a drop off point for Christmas gifts for children and young people. They will then be taken to the salvation army for distribution.
.
So whilst you're out and about shopping, if you felt you could buy an extra gift for a child, we know it would be so very much appreciated.
.
The #salvationarmy have told us it's gifts for both boys and girls aged 16-18 that they tend to struggle for. We've got started with some toiletries gift sets.
.
We know that these are incredibly difficult times for some of us financially right now so whatever you can afford will be absolutely amazing.
.
If you'd like to drop a gift to us to pass on, however big or small, please get it to our office, 48 High Street Banbury BEFORE 10th December and make sure it is unwrapped. And we'll be delighted to pass it on for you.
.
#helpatchristmas #salvationarmyuk #christmascharity
...

We are not a bank or building society.

We are family owned and independent mortgage and protection advisers.

And we THRIVE on our clients spreading the word about our expertise and service.

We have a little favour to ask...

Consider the following:

When you decide to use a service for a big life decision (an estate agent, a mortgage adviser, health care) how do you make your decision?

It's probably no surprise that most people make their choice based on other people's experience. This could be a conversation in person with a friend or family member, a recommendation from a colleague or online reviews.

Hearing positive comments and feedback from others helps us to feel secure in our decision making, this is particularly important when deciding who to use when arranging your mortgage. For a lot of us, this will be one of the largest financial commitments you will ever make.

We know it seems everyone is after a review for something these days but for a service like ours, your words could be the beginning of another client's journey with us.

(We can't advertise on TV like national companies. I'm not sure we'd want to!)

It's now easier than ever for you to leave us a review, taking just minutes to do. Please consider telling others about your experience with us as we strive to work hard for our clients and aim to get the very best result possible for them.

Here's the link: https://review.vantage-mortgages.co.uk

And keep your eyes peeled for how we will reward our clients who spread the love... 💗 (details are coming soon)

#mortgagebroker #mortgagehelpers #localbusinessuk

Your home may be repossessed if you do not keep up repayments on your mortgage.
Our typical fee for arranging a mortgage is £500 but this may vary on the complexity of your individual case.
...

So you may be thinking, doesn’t it cost a lot to change mortgage lenders?

Absolutely not! In fact most of the time for a simple swap it doesn’t cost anything at all. Most lenders will provide a free solicitor to handle the change over and they will usually cover the cost of the valuation too.

This is the point when we will find out about your situation, your income, outgoings and any other considerations that may need to be taken into account, like your credit history before we give advice on what to do next.

See more about this in my newest blog - link in the bio.

#remortgage #mortgagetips #mortgagehelpers #proudtobeprimis #mortgagelender #mortgagebrokers #oxfordshire

**Your home may be repossessed if you do not keep up repayments on your mortgage.
Our typical fee for arranging a mortgage is £500 but this may vary on the complexity of your individual case.
...

Say cheese 🧀 😄 Our faces are aching but what a lovely morning having some updated team photos taken. @katkaholliday made everyone feel at ease - can't wait to see the pics!
.
Dotty was a dream to photograph today 😍😍 I think we may have to do a Dotty calendar for Christmas or something 🤔😀
.
#mortgagehelp #mortgagehelpers #remortgage #officedogsofinstagram #officephotos #teampics #saycheese📸
...

Can Dotty get some love for wearing her poppy with pride today?
.
#poppywithpride #lestweforget🌹 #officedogsofinstagram
...

Call us

Email

Read Reviews