| What can I borrow? | ||
Lenders tend to use credit scoring where software gives an indication as to how much an applicant may borrow. As a VERY rough guide, about 3.5x a single income or 2.75x joint, but it can be more or less and lenders also have rules with regards to overtime and other non basic salary elements. If you have overtime, commission or other variable income some lenders will take all of it into account if it can be considered sustainable and perhaps has some track history. SELF EMPLOYED people will be asked for their net profit. If you have not done your first books yet, you can consult an Accountant to agree your profit figure. SELF CERT – is designed for people that have genuine difficulty proving income. Most lenders now tend to ask for proof the person is working, so might request Bank statements or some recent work invoices. A few lenders can consider no proof of income but they reserve the right to make requests. Note that you should never borrow more than you can comfortably afford and you will be asked to sign – off your stated income level. DIRECTORS – lenders tend to treat Directors as self employed. Some will take dividends into account as well as trading profit. Employed people may need to provide payslips, although some lenders might waive this where the applicant is deemed low risk, or perhaps where an employer’s reference is available. Summary It is impossible to predict how much you will be able to borrow, and only by applying will you know for sure. |