Self Certifieid Mortgage

Perhaps your hunt for mortgage lenders is not bearing fruit because you are self-employed. You are not alone – there are many like you – nearly three million. For them the best is to opt for self-certified mortgage.

It will be wise on the part of the mortgage companies to shed this role of a stepmother if they do not want to lose a big chunk of business. The prime reason for lenders being shy is that this group cannot speak for a stable income. This puts at risk repayment schedules. A self-certified mortgage will benefit both borrower and lender.

Another reason for denial is that the self-employed groups earn from various sources and thus it is difficult to compute it. It makes lenders shy about sanctioning a mortgage. Salaried people have the advantage of showing the P60 form as proof of their income. But in the case of the self-employed there is no concrete proof of income. Audit accounting for the last three years will have to serve the purpose and make the path easy for self-certified mortgage.

In self-certified mortgage disadvantage can be turned into an advantage. The self-employed can ask for any amount of loan without having to prove their income. The words of the applicant carry weight. Thus a self-certified borrower can obtain even 1 million pounds with 10/15% of deposits. It is up to the discretion of the lender. The rate of interest is comparatively higher than the regular ones because of the greater risk factor involved. The amount sanctioned is calculated after summing up the income of both the customer and spouse – that is if both are working, together with bonus, commission and any other source of income.

The borrower must take something that is affordable to his financial status. If mortgage instalment is high then there is the risk of default. If it is low then time will be wasted in repayment.

The borrower going for self-certified mortgage will be offered various options – tracker, capped or fixed rates. The ideal will be to opt for a flexible mortgage where the instalment will depend on the monthly income. At times a payment holiday can be taken while at other times the pace might be increased.

While lenders may make exhaustive enquiries the borrower too must survey the market before agreeing to a loan so as to avail of the best offerings.

Get your quote today for self-certified mortgage!