How to Get a Mortgage as a Partner of a US Law Firm Without a Recent Tax Return
If you’re self-employed and working for a US company, you might not have a recent UK tax return when you apply for your mortgage due to the US tax year calendar.
If you don’t know how to get around this, you'll struggle to get a mortgage despite being a high earner with a secure income.
Why is it difficult to get a mortgage as a partner of a US law firm?
As a partner of a law firm or a US equity firm, finding a mortgage is always going to be trickier as you're technically self employed. But if you’re working for a US firm, it complicates things even further.
When you apply for a mortgage, your bank will ask you for a recent tax return, and it needs to be dated within the last 18 months.
This isn’t an issue for those who are self employed and working in the UK, like partners of UK law firms, as your tax return can be filed every April.
But, if you’re self employed and working for a US company, you won’t be in a position to file your 2020/21 tax return until the end of the American tax year, which is 31 December 2021.
This means that between 6 October and 31 December, your most recent tax return (from April 2020) will be over 18 months old, and you might be rejected for a typical self employed mortgage.
Most high-street lenders aren’t equipped to handle this kind of problem. It’s not particularly common, so they don’t invest the resources into providing a solution.
A typical lender’s standpoint is that you can’t prove your income. Even if you explain the situation, provide bank statements and invoices, they won’t budge if it breaches their standard mortgage application criteria.
However, there are ways you can get around this and still get a healthy range of borrowing options to choose from.
Most lenders won't accept your application if your most recent tax return is more than 18 months old.
For these cases, a different approach is required to ensure a good range of options remain available, and this involves approaching the right banks and specialist lenders.
- Senior Finance Broker, Luther Yeates
How to get a self-employed mortgage without a recent tax return
To get a mortgage without a tax return dated within the last 18 months, you need to find the right lenders who are flexible on bespoke income situations like this.
Some private banks are open to practical solutions and will accept a letter from your partnership certifying your annual income.
The problem is that specialist lenders for scenarios like this are hard to find.
Finding them through a Google search won’t work, as lenders don’t necessarily advertise for every complex situation they can accommodate.
If you search for mortgage providers that lend to self employed partners with no tax return, you’ll get results for lenders who provide standard self employed mortgages – the search term is too specific.
The answer? Contact a specialist mortgage broker.
How can a specialist mortgage broker help?
- Specialist mortgage brokers, like Clifton Private Finance, know the expertise of every lender in the market.
- Our brokers filter out the banks that will reject your mortgage application flat-out and focus on providing genuine options from lenders who are willing to put in the extra legwork to understand your income situation.
- We have access to the entire lending market and approach a range of lenders and private banks to provide you with multiple borrowing options.
- We’ll give you a range of finance solutions to choose from based on length of term, interest rates, loan to value and other variables to ensure you get the mortgage that’s best for you.
If you’re facing your own challenges in getting finance for your property aspirations, speak to us today to find out how we can help.
Whether you’re earning in a foreign currency, earning merit-based pay, or have mixed sources of unorthodox income, we know the right private banks and lenders to speak to who look at the bigger picture.
Call us on the number below or send us a message through our contact form and we’ll get back to you.