Clean It Up
UK Window Cleaning Forum => Window Cleaning Forum => Topic started by: Davew on December 20, 2007, 09:35:32 pm
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As a window cleaner where payment is a lot of cash in hand, it's quite likely that some of us might try to.... ahem be less than one hundred percent with the taxman. This would obviously lead to a lower annual income. So my question is how do you get on with finding a mortgage being self employed etc. ?
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Declare what you earn.
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Are you saying you dont declare all :o :o
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If your employed the mortgage lender normally contacts the employer to verify your earnings. What happens if your self employed where earnings are less obvious is there a problem?
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Are you saying you dont declare all :o :o
You would be a fool to admit it, but with all cash in hand trades it's likely to happen.
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I'd rather sleep sound at night safe in the knowledge
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If you want a morgage you have to show good earnings,if you rent and have less outgoings you might prefer cash in hand,i wouldn`t.
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If your employed the mortgage lender normally contacts the employer to verify your earnings. What happens if your self employed where earnings are less obvious is there a problem?
Your accountant can sort out verifiying your earnings
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self certificate Mortgage
they rely on your to be honest ;) its how many today are getting such great whopping Mortgages
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self cert mortgage is what i had to do. 19k it cost me. i probably could of got one through normal methods but it seemed a minefiled so self cert was the one for me
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Well, we could self cert for more than we earn... but if we cant pay the mortgage, its gonna come back on us in the end! So its in our interests to be honest, surely?
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obviously we don't wanna live above our means...but what if our means were more than the mortgage company thought they were? ;)
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obviously we don't wanna live above our means...but what if our means were more than the mortgage company thought they were? ;)
LOL, they wouldnt lend very much :P
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Having no clue about this all, but moving out parents home next year, comes the following question :
Where can you read up on self cert. mortgages? And where can you get one?
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type self certificated mortgages into google. There's loads of info
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obviously we don't wanna live above our means...but what if our means were more than the mortgage company thought they were? ;)
LOL, they wouldnt lend very much :P
thats why you go self cert. ;) they do 5% self cert now as well just a higher interest rate
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i bought a house in february and in the process of trying to get a 'normal' mortgage i had to show 3 years worth of certified accounts.
Your best bet is to speak to an independant financial advisor and if you haven't got 3 years worth of accounts showing you have earnt enough then you will have to get a self cert mortgage.
The drawback if any is that you have to put a deposit down, a minimum of 5%. I managed to borrow 3 1/2 X my declared earnings but put down a 27% deposit to get a self cert mortgage.
You will struggle to get a high street mortgage without certified accounts and seeing an IFA will be the best thing you could do.
I think i paid £250 for his services.
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I am in the same position DaveW....I am declaring every single penny as the banks want 3 to 4 years of certified earnings (accounts prepared by an accountant)..
So at present I use george to prepare and print an income forcast and round valuation each week in addition to this I also run a spreadsheet with things like customers gained, dropped, suspended, moved, leaflets out in each area, customer gained in each area, percentages of customers gained/lost per week both yearly and total...
In essence I want to go to the banks armed with enough information to show that my business grows steadily each monthly, 3 monthly, 6monthly and annually..hopefully the banks can see that as a self employed one man band, I am a safe bet to lend money to with regard to a mortgage.
Being a foriegner in a new country I do not have any history with the banks so in order to gain a mortgage whilst being in a (percieved) cash in hand style business
we are trying to show the banks regular and steady growth, healthy use of bank accounts both money in and money out and not showing any form of debt....
Then of course it is always in the banks decision.... ;D
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self certificate Mortgage
they rely on your to be honest ;) its how many today are getting such great whopping Mortgages
It's also what's been fuelling the house price boom. Now that lenders are getting more nervous about lending to anyone who needs self cert, the prices have started to drop.
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No problem, get your mortgage first ,then drop your wages down ,long as you keep your mortgage payments up your alright,best thing about it the tax man will be helping to pay your mortgage ;)he helped me to feed my gambling habbit if i lost a poopload of money id say to myself oh i would of paid it in tax anyway ;D
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;D ;D lmao
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The problem with being self employed in the manner that we as window cleaners are, is that we submit our accounts to the tax man with the intention of showing our taxable income to be as low as possible, and it doesn't matter if you are using an accountant or not, as they are doing exactly the same thing for you.
Whereas when you want a mortgage you want your accounts to show exactly the opposite :-\
I'm afraid you can't have your cake and eat it too!
Ian
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That was my thinking in the respect of being able to show regular periodic growth combined with 'sensible' money management.
Dave.
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The problem with being self employed in the manner that we as window cleaners are, is that we submit our accounts to the tax man with the intention of showing our taxable income to be as low as possible, and it doesn't matter if you are using an accountant or not, as they are doing exactly the same thing for you.
Whereas when you want a mortgage you want your accounts to show exactly the opposite :-\
I'm afraid you can't have your cake and eat it too!
Ian
Exactly right.
If you are a sub prime buyer or self certificated you will not get the best rates and will pay through the nose which will cost you many thousands more over time.
Lenders are also tightening up now after the Northern Rock fiasco.
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If you run your own company just go on the books yourself for 3 months and keep the pay slips. You'll have to pay your tax, NI, etc upfront but you've got to do it anyway in the long run - once you've got around 3 months payslips it should be pretty easy to get a mortgage - all they want to see is that you've got money coming in to pay for your loan. Once it's gone through go back to being self em!
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The problem with being self employed in the manner that we as window cleaners are, is that we submit our accounts to the tax man with the intention of showing our taxable income to be as low as possible, and it doesn't matter if you are using an accountant or not, as they are doing exactly the same thing for you.
Whereas when you want a mortgage you want your accounts to show exactly the opposite :-\
I'm afraid you can't have your cake and eat it too!
Ian
Exactly right.
If you are a sub prime buyer or self certificated you will not get the best rates and will pay through the nose which will cost you many thousands more over time.
its only over the first 2 years while you get yourself on the ladder. once you have equity and history you can get the best rates possible.
It is a vicious circle. it took me a while to get on the ladder being self emploted. but once i got my hands on my 10% and made the plunge it got easier.
at least we should be in the position we we could afford a hefty mortgage bill. more so than a general factory or shop worker
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With the money you guys are supposed to earning I'm surprised you need mortgages ;D
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exactly simon....i've bought 10 houses out right ;)
i wish. ;D
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If I didn't have a mortgage and a 15yr old daughter and a wife who spends like it's going out of fashion I'd have a very nice way of life ;)
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With the money you guys are supposed to earning I'm surprised you need mortgages ;D
i was a little short, i only had 900 K in cash, i had to borrow 50 K from the bank
i should be able to pay that off in a few weeks if it doesnt rain :P :P
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If I didn't have a mortgage and a 15yr old daughter and a wife who spends like it's going out of fashion I'd have a very nice way of life ;)
a fact of life i'm afraid. I'm in that position but add a son into the equasion as well ;)
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Ouch!
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like being burnt with a red hot poker every day ;D
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Tell me about it. Anyway I'm off to do some more graft....ciao!
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If you run your own company just go on the books yourself for 3 months and keep the pay slips. You'll have to pay your tax, NI, etc upfront but you've got to do it anyway in the long run - once you've got around 3 months payslips it should be pretty easy to get a mortgage - all they want to see is that you've got money coming in to pay for your loan. Once it's gone through go back to being self em!
??? why
If you only have 3 months payslips most lenders will require employment history for up to 3 years previously. Also, don't think that they would go with this way of proving income as you would be giving fraudulent information to acquire credit and that is a no no!
If you have had a longstanding bank account. speak to that bank first.....they are now competitive with mortgage rates and if you have shown a steady income with them, that will stand you in good stead. Usually 3 years audited accounts are required for Self employed, but again if you go to your main bank they may just be able to bend their rules a bit. Self Certified, keep away unless you have 25% deposit or more, the rates will be more and the deals available less.
Sort out in your own mind what you can afford on monthly mortage payments, and be realistic. look for a good fixed rate that achieves that amount, if possible get a fixed rate for 3 or more years, but watch out for transfrability and penalty clauses. Your own bank probably has a mortgage consultant, speak to them, the advise will be free! ;D
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The problem with being self employed in the manner that we as window cleaners are, is that we submit our accounts to the tax man with the intention of showing our taxable income to be as low as possible, and it doesn't matter if you are using an accountant or not, as they are doing exactly the same thing for you.
Whereas when you want a mortgage you want your accounts to show exactly the opposite :-\
I'm afraid you can't have your cake and eat it too!
Ian
Exactly right.
If you are a sub prime buyer or self certificated you will not get the best rates and will pay through the nose which will cost you many thousands more over time.
its only over the first 2 years while you get yourself on the ladder. once you have equity and history you can get the best rates possible.
It is a vicious circle. it took me a while to get on the ladder being self emploted. but once i got my hands on my 10% and made the plunge it got easier.
at least we should be in the position we we could afford a hefty mortgage bill. more so than a general factory or shop worker
That is a good point.
All the time that property was going up in price weekly that was perfectly possible.
With property prices stagnating and in many places actually falling people who bought at the top of the market could actually be in negative equity in two years when they want to change to a new mortgage :-\
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The problem with being self employed in the manner that we as window cleaners are, is that we submit our accounts to the tax man with the intention of showing our taxable income to be as low as possible, and it doesn't matter if you are using an accountant or not, as they are doing exactly the same thing for you.
Whereas when you want a mortgage you want your accounts to show exactly the opposite :-\
I'm afraid you can't have your cake and eat it too!
Ian
its all specualtation in regards to where we will be in 2 years...we will see i guess
Exactly right.
If you are a sub prime buyer or self certificated you will not get the best rates and will pay through the nose which will cost you many thousands more over time.
its only over the first 2 years while you get yourself on the ladder. once you have equity and history you can get the best rates possible.
It is a vicious circle. it took me a while to get on the ladder being self emploted. but once i got my hands on my 10% and made the plunge it got easier.
at least we should be in the position we we could afford a hefty mortgage bill. more so than a general factory or shop worker
That is a good point.
All the time that property was going up in price weekly that was perfectly possible.
With property prices stagnating and in many places actually falling people who bought at the top of the market could actually be in negative equity in two years when they want to change to a new mortgage :-\
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??? why
If you only have 3 months payslips most lenders will require employment history for up to 3 years previously. Also, don't think that they would go with this way of proving income as you would be giving fraudulent information to acquire credit and that is a no no!
Helen,
I haven't heard one lender who has asked for 3 years employment history. There is nothing fraudulent about it, if you go on the books and pay your tax it is totally legit! I know at least five people who have done the above with no problems - the bank ask for bank statements as well to make sure the money is going in etc - I think your confusing it with lieing about how much you earn ???
No there is no confusion here. You are either self employed or employed, if you are LTD then you will be on the books so to speak. so no problem with proving income. What I am saying is that if you have ONLY 3 payslips which relate to the 3 previous months, the lenders will want proof of employment which will include proof of income aswell for up to the last 3 years. In some cases they will require emloyers written confirmation aswell. The terms differ from lender to lender and will also be dependant on the loan to value % mortgage requirement. I can only presume that the 5 you know who have done it this way had a large % deposit, which then reduces the requirements the lenders will ask for. That's why I said speak to the Mortgage consultant in your own bank, or even one based in an Estate Agency, they normally give free advise, you don't have to go with their mortgages offered, but you can glean alot of information from them and then be more confident to approach other lenders by yourself :)
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exactly simon....i've bought 10 houses out right ;)
i wish. ;D
Me too.
I put 2 on Whitechapel road, 3 on Pall Mall, 3 on The Strand and 2 on Regent Street.
No hotels yet though.
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i just showed my mortgage company three years of tax return calculations from the inland
robbers revenue and that was all i needed because the could see how much i was being taxed on so they knew how much i was earning.
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I had to have a self cert even with high equity. I paid a £500 arrangement and a higher interest which after two years became the same as everyon else's.
Pingu those spreadsheets sound really good, respect.
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I had to have a self cert even with high equity. I paid a £500 arrangement and a higher interest which after two years became the same as everyon else's.
Pingu those spreadsheets sound really good, respect.
I paid Near on £2000 for my mortgage I know that sounds really high but fixed lower than bank base rate at 4.75%, and it went up a few times since then so I am quids in over the terms I have.
I went to banks, and estate agents after my FA said the deal to me, and banks and EA's all said take it as it could not be beaten.
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I had to have a self cert even with high equity. I paid a £500 arrangement and a higher interest which after two years became the same as everyon else's.
Pingu those spreadsheets sound really good, respect.
I paid Near on £2000 for my mortgage I know that sounds really high but fixed lower than bank base rate at 4.75%, and it went up a few times since then so I am quids in over the terms I have.
I went to banks, and estate agents after my FA said the deal to me, and banks and EA's all said take it as it could not be beaten.
That's interesting.
Over what time period is your fixed rate?
Who is your lender?
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I had to have a self cert even with high equity. I paid a £500 arrangement and a higher interest which after two years became the same as everyon else's.
Pingu those spreadsheets sound really good, respect.
I paid Near on £2000 for my mortgage I know that sounds really high but fixed lower than bank base rate at 4.75%, and it went up a few times since then so I am quids in over the terms I have.
I went to banks, and estate agents after my FA said the deal to me, and banks and EA's all said take it as it could not be beaten.
That's interesting.
Over what time period is your fixed rate?
Who is your lender?
I am sure it is three years, and is with northernrock
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The bubble's going to burst int he next two-3 years.
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The bubble's going to burst int he next two-3 years.
thats what they said 5 years ago
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it amazes me how many property experts there are out there ;)
how do you know the bubble will burst in 3 years? ::)
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it amazes me how many property experts there are out there ;)
how do you know the bubble will burst in 3 years? ::)
Im not a property expert, I have turned around a few, and I also follow the market close, every year the same thing happens ::) it is 3 weeks before christmas so lets say market is dead prices drop 1 % in jan they rise again, this is the trend for the last few years, I was talking to my estate agent about this the other day and he asked would I drop my price, and my relpy was no I would put it up to cover the 1 % in crease in a few weeks time a desperate seller is easy to knock down on price same with alot of business.
I did this on the last property I sold and that sold second week of jan this year. Hopefully same again this year but still not finished yet so time will tell.
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not you Ian!!!
the guy before you!!!!!!!
i was simply implying that i've heard so many people say its going to crash with no real evidence.
your a touchy git sometimes ;)
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not you Ian!!!
the guy before you!!!!!!!
i was simply implying that i've heard so many people say its going to crash with no real evidence.
your a touchy git sometimes ;)
lol lol lol I know who you was talking about me Nat, it does make me laugh when people say it is going to crash as you say with no evidence only what they hear.
I just wanted to add that before someone else came on this post then had a pop at me as many like to do this, I thought I would get in first to stop it :P
Ian
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i hope it does crash. It is the biggest injustice in society today imo that most people who work full time cannot afford to buy any house. It is only possible if you pair up with someone or inherit money.
The average wage is suposed to be around 25k i think? The majority of people working around here in factories are lucky to get 15k a year. That's a mortgage of 60k tops. A studio flat will cost 80k+ and a terrace 100k+.
crash. crash.crash.
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i hope it does crash. It is the biggest injustice in society today imo that most people who work full time cannot afford to buy any house. It is only possible if you pair up with someone or inherit money.
The average wage is suposed to be around 25k i think? The majority of people working around here in factories are lucky to get 15k a year. That's a mortgage of 60k tops. A studio flat will cost 80k+ and a terrace 100k+.
crash. crash.crash.
either way I dont mind, I am in it for my kids future, it will always go up and down but over time it will always go up ;)
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crash. crash.crash.
the kiss your domestic customers
good bye, bye, bye.
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i hope it does crash. It is the biggest injustice in society today imo that most people who work full time cannot afford to buy any house. It is only possible if you pair up with someone or inherit money.
The average wage is suposed to be around 25k i think? The majority of people working around here in factories are lucky to get 15k a year. That's a mortgage of 60k tops. A studio flat will cost 80k+ and a terrace 100k+.
crash. crash.crash.
Houses in France start at £20 -25K and you can buy a place in Poland for under £3K. There was a thing in the paper this week saying that 93% of would be first time buyers don't earn enough to buy any property in their area.
We are destined at this rate to end up as a nation of migrant workers, living abroad and Easyjetting in to work.
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I'm old enough to have been through fifteen and a quarter percent interest rate (my first house) then see it happen again. I've also been through negative equity where people had massive mortgages higher than the value of their home and many were forced to hand the keys in. The market is far from predictable. the first people to deny a crash are the estate agents for obvious reasons. Strange then that a local one has just closed. Several starter homes are popping up for sale in my area - second homes where amature landlords are bailing out. Things don't look good in property in my opinion.
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I'm old enough to have been through fifteen and a quarter percent interest rate (my first house) then see it happen again. I've also been through negative equity where people had massive mortgages higher than the value of their home and many were forced to hand the keys in. The market is far from predictable. the first people to deny a crash are the estate agents for obvious reasons. Strange then that a local one has just closed. Several starter homes are popping up for sale in my area - second homes where amature landlords are bailing out. Things don't look good in property in my opinion.
I have to mostly agree with Dave here who obviously has a long experience of property owning history.
Investing is my hobby and I take a close look at markets.
A lot of would be speculators ::) have been burnt with this buy to let rubbish, paying the top price from developers for two bed flats, unable to get the rent required and having them repossessed. The glut of available properties obviously reduces the value.
The rate of rise in property prices compared to wages is unsustainable IMO. If this was a stock people would be selling now.
i hope it does crash. It is the biggest injustice in society today imo that most people who work full time cannot afford to buy any house. It is only possible if you pair up with someone or inherit money.
The average wage is suposed to be around 25k i think? The majority of people working around here in factories are lucky to get 15k a year. That's a mortgage of 60k tops. A studio flat will cost 80k+ and a terrace 100k+.
crash. crash.crash.
Around where I live those places would be snapped up.
I live in the most expensive area of the country. My son has just bought a small two bed terrace for £250,000 which is the going price around here.
It is inquitous and although current prices make my house worth a fortune I would much rather see prices drop to a price available to all.
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Quarter of a million? Strewth! When i was working in a factory last year my earnings were constantly being cut year after year. One apprentice took on £180,000 over forty years which i thought was frightening. The banks and Government don't seem to have a grasp on whats going on.?
I don't know much about money or politics but i do know about common sense - something that seems sadly lacking from the people that run the country and dictate the economy.
Who gains from all this? The banks WANT you in debt - thats how they make their money the more they can lend the better and the more people who can't make their credit card payments on time - brilliant! Then there's the government creaming off all that capital gains tax on property and of course all that lovely inheritance tax - double whammy or what? Who suffers - us the consumer/tax payer and the small trades providing luxury services like window cleaning :-\
Then there is immigration - don't start me on that - friggin politicians my *rse!
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crash. crash.crash.
the kiss your domestic customers
good bye, bye, bye.
i'm alright jack. All my customers are rural and mostly mortgage free.
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longer term mortgages ie between 50 and a 100 years is the answer to affordable repayments some people in the future will never own there house just pass it on to there children as an investment..
example a pal of mine has just taken on a 35 yr old mortgage after a split from the Mrs. thing is now he is 41 yrs old....this was is only option of getting back onto the property ladder
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crash. crash.crash.
the kiss your domestic customers
good bye, bye, bye.
i'm alright jack. All my customers are rural and mostly mortgage free.
so you know your customers that well you know that there all mortagage free? of course!! ::)
I to have a lot of wealthier rural customers but don't let that decieve you. just cause they live out in the sticks doesn't mean they are all that wealthy. i'm sure they have mortgages the same aqs any other customer!!
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so you know your customers that well you know that there all mortagage free? of course!! ::)
I to have a lot of wealthier rural customers but don't let that decieve you. just cause they live out in the sticks doesn't mean they are all that wealthy. i'm sure they have mortgages the same aqs any other customer!!
i'm alright jack. All my customers are rural and mostly mortgage free.
No i don't know for sure it's just a guestimation based on age and how long they've lived there.
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so you know your customers that well you know that there all mortagage free? of course!! ::)
I to have a lot of wealthier rural customers but don't let that decieve you. just cause they live out in the sticks doesn't mean they are all that wealthy. i'm sure they have mortgages the same aqs any other customer!!
i'm alright jack. All my customers are rural and mostly mortgage free.
No i don't know for sure it's just a guestimation based on age and how long they've lived there.
you know what they say about asumptions being the mother of all fu**up's ? ;D
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it can be very difficult ,
however the bigger deposit you can manage , the easier it should be !
i am moving into a new house next month ( after seperation ) , and i have had hassle and problems
organising a mortgage .
i was reccomended to a financial advisor who had arranged mortgages for some of my s/e friends ( not cheap) , but i have a mortgage offer , and touch wood a new house to look forward to .