Company Director Mortgages

Will I have to put down a bigger deposit as a company director?

When applying for a mortgage as a company director, you will not have to put down a larger deposit. In theory, you should have access to the same mortgage deals as any other borrower. This is typically up to 95% lending in straightforward scenarios.

Normally, larger deposits are required if you have a bad credit history. They can also be used to gain access to more financially attractive mortgage products.

Some specialist lenders, with more flexible assessment criteria, may require a larger deposit to be put down – limiting the maximum LTV to, for example, 85%. This will allow them to offset the increased exposure to risk in comparison to standard mortgage lending.

Be aware that it’s also common for most lenders to require larger deposits on larger loan amounts. On mortgages over £750,000, for example, a lender may restrict the LTV to mitigate the increased risk.

How do I prove my income as a company director?

Most lenders will ask you to provide full, finalised accounts and/or SA302 year-end tax calculations from HMRC. Lenders usually need your accounts or SA302 to cover at least one full tax year. However, it’s common for them to ask for two or three years’ worth of accounts.

Lenders will typically require your accounts to be certified by a qualified accountant. They may also ask for copies of your business and/or personal bank account statements. This is usually the past three months’ worth.

If a lender asks for more than one year’s accounts to verify income, they will, in most cases, take an average to calculate your income figure. This can be frustrating if your business has built over the period concerned. It’s worth knowing, therefore, that particular specialist lenders can base their income figures on the most recent year’s results.