ExPat/SelfEmployed/FHB Home Loan

Discussion in 'Loans & Mortgage Brokers' started by gelliott, 14th Apr, 2021.

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  1. gelliott

    gelliott Member

    Joined:
    14th Apr, 2021
    Posts:
    9
    Location:
    Brisbane
    Hi Everyone, I'm glad to have found this site and hoping I can get some answers and guidance on my current situation in applying for a mortgage. I have a number of questions, but some background first. I'm an expat, having lived in the UK for the past 20 years, but returned in Jun 2019. Having moved back, I had no idea of the complexities and challenges there are in applying for a mortgage. It was far simpler in the UK, but then the UK is more complicated in other areas such as gazumping and long property chains.
    Current Status:
    - Me (47): Self Employed, ABN and Incorporation in Jan 2019. I'm an Enterprise Architect and work remotely for an organisation in Spain, but billed through the UK. I've had the same contract both before moving back to Aus, and since. My contract is around $275k per year (daily rate of £600). All run through my own pty ltd company and I pay Super, and Salary for this amount. My 2019/2020 salary from my own company was $220,000 and will be roughly the same for 2020/21. I did some other internet stuff as well, but only brought in a small amount of around $20K.
    - Wife (45): Has not been employed the last 14 years as she's been a stay at home mum, and hasn't really needed to work up until now. She recently started a casual job in caring, but very recently and not long enough to consider for the mortgage.
    - Deposit: Currently have around $120k for a deposit. Cost us a fortune to relocate and setup back in Oz, so a lot smaller than we originally hoped for.
    - Assets: Not very much, $110k in super here, and £30k in pension in the UK. Cars about $20k, Shares $15k
    - Target Home: We're looking to purchase around the $800k mark.
    - Debt: No debt at all for the past 2 years. Before that, it was only mortgage in the UK and 1 credit card with small limit.
    - Defaults: None
    - Credit History: None, even though we've been back in Oz nearly 2 years, we've had no debts, mobile phone is paid up front etc, which means we have an entirely clean credit report, with nothing at all reported. Not sure if this will be a problem.
    My Questions:
    1) Bank Statement History. How far back would we be expected to supply bank statements?
    To be brutally honest we've been pretty p*ss poor in managing our money. We have always lived within our means, but also, lived to our means. Transactions are all over the place, ie, I would take 1000 here and a 1000 there from the company during them month, and at the end of the month add these up for my pay run to submit my BAS. We also eat out too much, spend to much on various stream subscription services (basically all of them), drink to much, and buy too much. Again, all within our means, but wasteful nonetheless.
    I have since cleaned everything up, created a budget and sticking to it, cancelled most subscriptions as we didn't really use half of them, and now pay a single payment each month from the company into our account. The plan is to do this for a number of months (and after) to present as a more fiscally responsible applicant. So really I want to know how long we should do this before applying. On the plus side, it's helped us go from p*ssing money away to saving 3-4K per month.​
    2) As I'm an IT professional, and have been in the same industry for the past 20 years, does this make a difference when it comes to a Self Employed application?
    3) Based on an 800K house, and with our 120k deposit, it will come to around 12% deposit after stamp duty and fees. Will this further complicate our situation?
    4) Are there any recommendations for the best banks to deal with for Self Employed Professionals with long term contracts?

    I appreciate this has turned into a longer post than I anticipated, but would appreciate any comments feedback to this.
     
  2. Tony Xia

    Tony Xia Structured Loan Advisor Business Member

    Joined:
    23rd Aug, 2015
    Posts:
    1,546
    Location:
    Bella Vista
    Good to have you in here,

    A few things that popped into my mind.
    - how long has your ABN been registered for
    - have you done your last 2 years financials?
    - if yes, was there a big difference with revenue for the 2 years?

    Deposit wise you might make it, $25k will need to be allocated for stamp duty (QLD)

    Leaving you with the remainder $95k as a deposit + mortgage insurance, so potentially borrowing 92% Inc LMI.

    Subject to borrowing capacity offcourse.
     
  3. Rolf Latham

    Rolf Latham Inciteful (sic) Staff Member Business Plus Member

    Joined:
    14th Jun, 2015
    Posts:
    10,599
    Location:
    Gold Coast (Australia Wide)
    Im biased, but an experienced broker is a better bet here .

    Most lenders have a very parallel policy with some lenders having exceptions which you may need, such as relying solely on the most recent tax returns and allowing current BAS to be partially used as a mitigant etc

    ta
    rolf
     
    Lindsay_W likes this.
  4. gelliott

    gelliott Member

    Joined:
    14th Apr, 2021
    Posts:
    9
    Location:
    Brisbane
    Thanks Tony for the reply. My ABN has been registered since Jan 2019, but I didn't start receiving income in it until March 2019. So essentially I have 2 years of financials, but one of those was partial for 3 months.
    The revenue was different in those use due to the partial, however, I'm happy to wait until the end of this financial year before applying for a mortgage. In this case I'd expect 2019/20 and 2020/21 to be very similar in revenue.