If you are looking for a self employed mortgage there are some ways that you can help to ensure your search is as straight forward and as easy as possible. Finding a lender who understands the needs of those looking for a self employed mortgage can be tricky, however there are lenders that can help and offer a range of mortgages for the self employed. This means that some lenders can offer self employed mortgages for those just starting out on their own or in partnership and those with a few more years’ experience under their belt!
- Make sure your accounts are signed off by a suitably qualified accountant. The more years you have the better. Some lenders will offer self employed mortgages if you only have 1 or 2 years of accounts.
- Credible forecasts are essential and important. Lenders will want to see realistic and credible forecasts for your future income. If you are newly self employed and looking for a self employed mortgage then you should also ensure the lender knows if your previous form of work was in the same profession. Sometimes lenders view an existing history in the same profession to be an advantage.
- Have all the usual documents ready as well; bank statements, balances of credit cards and loans and evidence of any benefits you may receive such as tax credits.
- Look for a mortgage lender who makes their decisions using manual underwriting. This means they use people and not computers to make their lending decisions. By using real people these lenders can contextualise more complex scenarios to help assess if the mortgage loan is affordable. Unlike automated mortgage lending processes, it allows for common sense and judgement to be used. Often smaller regional building societies are more likely to use manual underwriting.
- If you want extra help and support in finding a self employed mortgage you may wish to approach a mortgage broker. They can often help to make your search of the mortgage market quicker as they know the lenders who specialise in supporting self employed mortgages. Further more they can also help to check that the self employed mortgage is right for your situation and that your circumstances suit the mortgage lender.
You can also watch this useful video from Ipswich Building Society to find out more about mortgages for the self employed. The Society has also identified that 2 out of 5 self employed people are concerned about getting a self employed mortgage. Of course, there’s no guarantee you will get a mortgage: having a good credit history and being able to afford your mortgage payments now and in the future as interest rates rise remains key to any decision a lender may make about lending to a self employed borrower. However, if you have these in place and if you remember our 5 tips above, then you should be in good stead to find a self employed mortgage.
YOUR HOME MAY BE REPOSSESSED IF YOU DON’T KEEP UP REPAYMENTS ON YOUR MORTGAGE