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Help getting a mortgage for Self Employed People

There has been a considerable tightening up of the amount of available mortgages for self employed people – with self-certification mortgages gone completely. However, that does not mean it is impossible to secure a mortgage if you are self-employed – you just have to know where to look, and thankfully here at Ascot we certainly do.

Ascot look at a number of smaller building societies and specialist lenders, who are able to look at applications on a case-by-case basis… rather than a “computer says no” approach which is more common with the high street lenders! It is a myth that smaller building societies and private lenders are more expensive, on the contrary, some of the smaller lenders may be offering the best value mortgages – it all depends on your circumstances and the mortgage products available at the time. Please get in touch and we will discuss, prepare and tailor, a suitable option for you based on your circumstances.

Mortgages for Self Employed People

Getting a mortgage has become increasingly difficult as the economy was plunged into a double-dip recession, and banks are increasingly wary about lending to new customers. For many domestic and commercial customers this difficulty in obtaining a mortgage has meant that property ownership has remained a distant dream. Things are often doubly tough if you happen to run your own business and are self-employed: self-employed usually means that you own 25 per cent or more of the business. The days of self-certification mortgages, and where lenders required limited proof of income, are long gone but this does not mean that a mortgage is impossible if you are self-employed, and you should have access to the same range of products that an employed person has. A large deposit always helps, as does a good credit history and savings, but even without these getting a mortgage is not impossible. If you are self-employed and looking for a mortgage then your best option is to go to a mortgage broker, who can explore the market to find you the best deal for your situation.

Using a mortgage broker if you are self-employed

Along with saving money there are other benefits of using a mortgage broker to arrange your mortgage , especially if you are self-employed. The time saved by using a broker, especially if you have a small business and cannot afford to take time out, is invaluable. Here at Ascot Mortgages our clients report that by using us to arrange their mortgage, if they are self-employed, they not only save time and money but also benefit from our range of contacts with lenders. As established and respected brokers we are able to approach the lender who is right for you and we also offer an initial no-obligation consultation, free of charge. For a self-employed person our experience is vital because we are able to approach the lender who is best suited to meet your needs and who is happy to lend to a self-employed business owner without charging a premium for the privilege.

Getting a self-employed mortgage approved first time

Along with the time and hassle that this saves you there is another reason why us placing your mortgage application with a lender who we know, is likely to be able to help you is a good idea: the more likely that your mortgage is to be accepted with the initial lender that we approach, then the less likely you are to be continually credit-referenced, which can cause lenders to approach you with caution in the future. As the economic crisis has demonstrated credit is more and more difficult to get, and lenders who see constant credit searches and failed applications on your credit file might be more wary about lending to you. As a business owner, this is the last thing that you need.

The overall cost for comparison is 5.89% APR. The actual rate available will depend upon your circumstances. Ask for a personalised illustration.

Here at Ascot Mortgages we use our experience to make sure that we have all the right documents for a successful first application. Some documents that might be needed include accounts, statements from the Inland Revenue (SA302’s) and Accountant references. Here at Ascot Mortgages, we can inform you of exactly what is needed and verify these to save you any wasted time or effort.

Self-employed mortgage income criteria

The criteria that lenders use to measure your income can vary too and that’s why using a mortgage broker like Ascot Mortgages can be invaluable. Some lenders wish to see net profit only, others like to see salary plus dividends or salary plus net profit. Some lenders might be happy with a year’s evidence of income, but the more standard amount is two or three years.

Other factors to consider

The range of requirements can not only be confusing but the variables needed mean that sometimes we could identify that a lender might be more suited to your situation: for instance if you employ only one member of staff then your needs might be different to somebody who employs a larger workforce, and this might be reflected in the way that the lenders measure your accounts. Often lenders will look at more factors than just income, so they might consider existing financial commitments to calculate if you can afford the repayments on your mortgage. Some lenders can have more discretion or flexibility than others, and that’s why using a broker like Ascot Mortgages can provide a real advantage in your mortgage application.

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