Joint Mortgage One Self-Employed

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Joint Mortgage One Self-Employed – Finding a suitable deal

Taking out a joint mortgage can significantly boost your borrowing potential, so you could afford a more expensive property. Our clients often wonder how it works with a self-employed applicant – and the good news is that this is very common and usually straightforward.

Can you get a joint mortgage with a self-employed person?

When you’re buying a home, self-employed mortgages jointly with another applicant are a good option to explore. Lenders will combine both incomes to calculate the loan amount, so it can mean you can borrow more.

This kind of joint application is available on most mortgage products. Mortgage lenders will assess affordability for each applicant separately and take a look at your credit scores. If you have bad credit but your partner has a good credit record, you can often find it easier to get a joint mortgage than an individual one.

How much can you borrow with a self-employed joint mortgage?

The amount you can borrow is based on your income. Lenders generally multiply your annual earnings by four or five to calculate the mortgage total. With a joint mortgage, the figure used is your combined annual income.

As an example, if your partner earns £35,000 on PAYE and your self-employed income is around £25,000 per year, your combined income is £60,000. You could therefore potentially borrow up to £300,000 on a mortgage. 

It’s important to explore what your potential loan amount will mean in terms of the repayments on your mortgage, to make sure they are comfortably affordable. Putting down a larger deposit will reduce the monthly payments.

What documents do you need for a joint self-employed mortgage?

Each applicant needs to provide proof of income – and this works differently for a self-employed person versus someone in an employed role. 

An employed applicant usually supplies payslips to confirm their salary. Meanwhile, self-employed people will need tax records or company accounts for the past one to three years.

Both applicants will also need to show proof of ID via a passport and driving licence, plus recent bank statements.

How does it work for a Sole Trader / Contractor / Limited Company?

The documents needed vary by lender and can depend on your business set-up. 

Sole traders tend to supply one to three years’ tax details, including SA302 self assessment forms which state your annual earnings. 

Limited Company Directors usually need one to three years of accounts. Some lenders will accept net profit in your business as well as salary and dividends, which can often mean you can borrow more. Your mortgage broker can advise on this. 

Contractors may be considered as sole traders or limited companies, but some lenders accept a contracting day rate as income, together with proof of contract.

Does a mortgage have to be in joint names?

When you apply for a joint mortgage you will generally be able to borrow more, which is why they are popular – but ultimately it’s your decision whether you apply singly or jointly. 

If you will both be paying the mortgage, it is a good idea to put both names on the mortgage so you can share the equity. You can also choose to put just one person on the mortgage but two people on the deeds for the property, although not all mortgage lenders will allow this. 

How can a Mortgage Broker help?

A Mortgage Broker like Fancy a Mortgage is here to help you explore your mortgage options and achieve your property goals. 

We advise on all kinds of property finance: individual mortgages, joint mortgages, Buy to Let mortgages and remortgage deals. We compare fees, rates and criteria across suitable products to recommend the most suitable options for you.

Once you’re ready to start applying for a mortgage and buy a property, we’ll support you all the way, checking you have the documents you need and keeping things moving. 

Fancy a Mortgage is a trading name of Total Home Loans Limited which is an appointed representative of Quilter Mortgage Planning Limited and authorised and regulated by the Financial Conduct Authority. We are registered in England and Wales. 

YOUR HOME MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON YOUR MORTGAGE.

Your home may be repossessed if you do not keep up repayments on your mortgage.