First time buyer - Company owner taking modest salary and dividends

My client, a company director, was a first time buyer who wanted to purchase a flat above a commercial property. His company had been running since 2008 and had grown into a very successful business. Due to his financial circumstances, he took a minimal salary and dividends from the business.

Since most lenders use an average of the last two years’ salary and dividends when assessing income, my client would not have been able to secure the mortgage he needed. Also, the flat he wanted to purchase was located above a commercial property, something which many lenders were not happy with. My option, therefore, was to find a lender who was:

a) Happy to look at the net profit my client’s company was making.
b) Willing to review the retained profit in his business over the last 3 years.
c) Open to offering fair mortgage terms given on a private residence situated on a commercial property.

Prior to approaching Holbrook Property Finance, my client had spoken to another mortgage broker who found him a lender. However, due to the presence of a commercial property below the flat, the lender had limited the loan to value on the mortgage to a maximum of 75%.

I was able to find a lender who was happy to use the net profit from my client’s company and also consider up to 90% loan to value. This meant my client was able to receive a loan, while also reducing the deposit he needed to put down. Needless to say, I had a satisfied client who got the financial solution he needed.


Stephen Baldwin – Senior Financial Consultant