The problems faced by the self-employed and business owners
Gone are the days of self-certification and fast track mortgages, which required little or no proof of income and allowed the self-employed to get a mortgage or re-mortgage relatively easily. But with no current replacement, the self employed and many small business owners feel left out in the cold.
Nowadays, although it is not impossible for someone who is self-employed to secure a mortgage, it can certainly be a difficult process. This can be frustrating, especially if you have the deposit and income needed to keep up repayments. You may be refused a mortgage simply because your income does not fit that lenders “ criteria”
About 40% of all my clients are self employed, from company directors to taxi drivers and everyone in between. I understand exactly what a lender is looking for and how to present your application to the lender and give them the reason to lend.
Did you know that many lenders are looking for three years accounts but there are other lenders that are happy to consider just one years accounts. But be careful, if you approach to many lenders, you could end up damaging your chances, the reason for this is that most lenders will do a credit search on you if you enquire or apply with them, you might not fit their criteria but it might leave a mark on your credit file that other prospective lenders will see.
What about my credit rating?
Even if your current credit rating is not as healthy as it once was, there are lenders out there that will look at your case on an individual basis. As your mortgage broker, its my job to know who they are.
So what do I do?
With the ever increasing numbers of self employed in the UK, lenders have realised that this is a lucrative market and mortgages for the self employed are being offered everyday, but ! you do really have to know what you are doing and how to present yourself to the lender, that’s where I come in, with over 20 years experience dealing with the self employed, I know the best way forward. What you may consider to be a problem, I’ve seen many times before. I will advise you of exactly what you will need, to get your application approved and an offer on the table.
- Work out exactly what is affordable for you based on income and expenditure.
- Liase with your account if required to obtain SA302s or accounts
- Obtain a lenders Mortgage Agreement in Principle/Mortgage Promise for you.
- Complete, or help you with your mortgage application form.
- Recommend a competitively priced Solicitor.
- Once your mortgage offer is issued, I will go through your mortgage offer with you to ensure all the details are correct and that you are happy with the offer.
- Recommend a bespoke insurance package tailored personally for you.
Did you know that some lenders will allow Working Family Tax Credits & Child Tax Credit as income ?