If you’re self-employed, then you may be under the impression that self-employed mortgages are the holy grail in the world of home ownership. After all, they have been harder to obtain than your average mortgage for a number of years.
This wasn’t always the case, of course. Back in the heady days of self-certification mortgages, anyone could get a self-employed mortgage as long as they declared what they earned – without even having to show proof.
Whilst it does seem a little dubious now, that’s how things were done – and it worked. For a while, at least. Until they were removed from the market in 2014.
Now, regardless of whether you’re employed or self-employed, you still have to apply for a mortgage in the same way, and face the same set of questions from mortgage brokers and lenders.
It’s fair to say that those applying for a self-employed mortgage may face greater scrutiny than those who are employed. Equally, self-employed mortgage applicants may not have access to the same size of loan that those on PAYE do. However, there is some good news.
Recent moves by government to make mortgages more accessible, which you can read about here, have led to an increase in the amount of low deposit mortgages on the market. Importantly, these 5% deposit mortgages are available to everyone, regardless of how they are viewed by HMRC.
There has long been a myth that the self-employed need to stump up 50% of the value of the property they’re hoping to buy. This isn’t the case. So, if you’re self-employed and think that recent government initiatives to get people on the property ladder don’t apply to you, then think again.
There are things you can do to increase your chances of getting a self-employed mortgage, though. Our top five are:
1. Look to improve your credit score prior to applying for a self-employed mortgage
2. Pay off large debts such as loans and credit cards
3. Trim down your outgoings
4. Work with an accountant who can simplify your finances when it comes to presenting them to lenders
5. Use a mortgage broker! Complete Mortgages, for example, is an award-winning Guildford mortgage broker with a high success rate in securing self-employed mortgages for our clients. Not only can we access the best self-employed mortgage deals, but we’ll manage the entire process for you, from beginning to end.
Speak with one of our self-employed mortgage specialists by contacting us on 01483 238280 or by emailing firstname.lastname@example.org.