Unpaid Invoices

[albaqwerty]

I'll try to be succinct.

The sons' pal was wondering about submitting invoices to various people/companies he will be doing work for.

He was wondering if he took those unpaid invoices to a Bank, would they consider him for a mortgage as he thinks he's got proof of an income.?

Would a Bank be committing some sore of fraud?

I doubt it, very, very much, the Banks surely would want to see proof of an income and not a pretend one

[fiction-factory]

It would be fraud i think if it wasn't a genuine invice for agreed work done. But I doubt a bank would accept invoices as an indicator of income/ability te pay. They'd want accounts wouldn't they- maybe a year or two's accounts

[ummmm]

We had to submit 3 years worth of accounts. Unpaid invoices are included in that. They'll want to see his profit and loss.

[pixie374]

Yes, you need 3 years of accounts now.

[Zacs-Master]

A bank would be rather dismissive of someone trying to get a mortgage based on unpaid invoices, to,say the least. I do feel for young people trying to,start out in life.

[albaqwerty]

thanks FF.
I thought fraud too, but he said that if he submitted an invoice, say for 12 months ahead, that ''I'd be building you a shed and I did that, then there would be no fraud, becauseI did what I agreed to'

Told him that his customer could pop off this mortal coil, so definitely not a good idea.

Thank you for answering x

[albaqwerty]

oooh, heck, thanks folks for your answers too
most grateful

[fiction-factory]

Okay, that's not fraud so long as he makes it clear to the bank that it's an invoice for future work, but I doubt a lender would accept such invoices as evidence of futre income unless there is a track record of income and of such invoices issued on this basis being paid

[albaqwerty]

he's only been self-employed for a year and a half,
I sympathise with him, trying to do the best for him, his missus and child.

Replies are most helpful and once again, thank you each for your time.

[chrissa1]

My late husband and I had the exact opposite of that happen to us in the early part of the 2000s.
We were doing a very large contract for a very large building company in Edinburgh. Their payments to us were well overdue but they persuaded us to complete the job ANDREW used the words, “there are three cheques in the drawer.”

The Queen was due to open the building and so we were forced to accept them at their word.

We were never paid and shortly afterwards our company went into receivership. :(

[chrissa1]

ANDREW???? Should be and.

[Peter Pedant]

yes I agree with you

say they will probably ask you to wait and see the income stream
and then send him along to a bank ( as he wont listen to you)

tell him the "apply" button at the bank must not be pressed
as a refusal gets onto his credit score like forever

No it is not fraud unless he is sure that the invoices wont be paid

an invoice for future work aint an invoice
more a quote
I think they might bault at a document for future work he might do

[Peter Pedant]

chrissa I am so sorry to hear that

one of my family was caught like that ( and went under)
whilst a good few said - this sounds like a rip off you know - are you overstretched ?
kinda didnt make him feel better when he hit rock bottom

I am so sorry

[chrissa1]

Thanks, PP. Much appreciated.

[Maydup]

It might be worth having a look online for him to see if there are any start up support schemes in your area. These government funded schemes give a level of legitimacy to the newly self employed and help with business planning and accounting, and open doors at the banks etc. It might involve a bit of jumping through hoops for sons pal, but might be worth it.

[albaqwerty]

their pal has been here for most of the afternoon, so have been running up and down stairs (hah, I don't run)
but he asked me to thank you all for your advise and suggestions and help. He appreciates the time you have taken.
(and I do too)

[EDDIE51]

As said, invoices can ONLY be for work you have actually done. ''Invoices'' for future work are just quotes/enquirers . No use to a bank.