This weekend is the 76th British Academy Film Awards, better know as the BAFTAs, a key date in the diary for any actor. However under the glitz, glamour and greasepaint of the silver screen, or indeed the West End stage, many showbusiness professionals can find it more difficult to get a mortgage than to pick up one of the coveted BAFTA masks.
Speaking to this publication, Austyn Johnson (pictured), founder of Mortgages for Actors, said: “There is a bit of discrimination when it comes down to the career choice…but a lot of the challenge is down to the variableness of income.”
No Christmas bonus
He said an example would be at Christmas time when many theatre people would get “paid incredible amounts of money”. He noted that if they applied at that time then their affordability would be good.
However, if they waited until after Christmas when the pay stops then they may not even get a mortgage, despite having earned £20,000 to £30,000 over the Christmas period, as lenders say they have no proof of income.
“That’s one of the main barriers we come up against,” he added.
Multiple incomes, self-employment, tax quirks
“You get multiple streams of income as well when they’re doing seven different things because they don’t always work for the same people. They might work for five or six people.”
An example was a client who worked for Netflix but was also self-employed and worked at a family member’s firm where she performed as a princess.
Other “quirks” that come up could include getting paid in a different currency, for instance performers on cruise ships, who get paid in US dollars and may not have to pay tax.
He said that with variable income, he would go to a “specialist lender almost every time” but some would still struggle to accommodate certain cases.
“We might have to plan ahead rather than work with what we’ve got now,” he said.
Changing how the industry views actors
Mortgages for Actors is a branch of HD Consultants, which is a 10-strong financial advice firm and Appointed Representative of Primis.
The firm specialises in offering those in the entertainment industry mortgages, as well as protection and financial planning, with clients in TV, film, theatre, music and YouTube sectors. It also workers with influencers, content creators and bloggers.
“We’re in the process of changing how, not just mortgage lenders, but everyone in the finance industry sees that career, because it is a career at the end of the day,” he added.
Lenders should look at full year of accounts
Johnson said that a lot of lenders will look at three months’ bank statements, but to “truly know someone in this industry”, lenders need to see a full years’ worth of income.
He said: “There are almost no lenders that would do that straightaway, you have to go outside the box a bit. I’ve got a lot of really good connections with a lot of lenders and most of them will go outside the box for me quite a lot, which helps.”
Johnson said one of the reasons three months of statements were asked for was to “streamline” the underwriting process.
“I would like them to take a bit more time on self-employed people like these sort of clients, because if they could see a whole year’s worth of income then they could basically work out what next year’s tax calculation is going to say anyway.
“If that’s a trend for them, then they know they’re roughly going to earn the same amount every year, if not more. So, I think really all that needs to change is they need to start looking at a year’s worth of bank statements,” he explained.
‘Constantly looking to expand’
Johnson said that he had been working with actors for a few years, but the decision to start a separate branch was due to the pandemic because “we needed to show people they can get help”.
“It was a really tough time, but we managed to get quite a lot of people through anyway and the ones we couldn’t get through, we planned ahead for.”
Johnson said that himself and Howard Reuben, principal and founder of HD Consultants, oversee Mortgages for Actors and up to 95 per cent of his day-to-day was now this business.
He added that there were two brokers coming on board and a protection broker had just started, but recruitment was still a priority.
“We’re still looking for people and we’re constantly looking to expand because it’s so busy Howard and I can barely keep up,” he noted.
He added that around 60 per cent of the business came from actors and the remainder was from everyone from lighting designers to Only Fans performers.
Johnson added that he got a “lot of work” from other brokers that “either haven’t got time or haven’t got the knowledge to do it.”
“Everyone that works in the entertainment industry needs to be looked after better than they are getting looked after by the normal brokers down the road, because [for them] it is a numbers game,” he explained.
