A step by step guide
It is not very difficult to get a Mortgage if you are self-employed. However, a popular misconception that self-employed applicants have is that they will be unable to get a mortgage or that they are only eligible for a subprime mortgage. It is true that the self-certification mortgages are no longer on the market but for self-employed people, the mortgage market is as open to them as it is to anyone else.
Lenders are very open to self-employed applicants, and if you use a mortgage broker, you will obtain all the information and advice needed to help an independent applicant in the mortgage process.
I have listed out a step by step guide on the process to enable you to get the best mortgage for your particular needs.
Get your accounts in order
Most lenders are happy to give mortgages to self-employed people who have been trading for at least three years and have two years accounts or self-assessment tax returns available. However, if you are unable to get three years accounts you may still be able to get a mortgage.
Speak to an accountant
Lenders prefer borrowers to employ an accountant to prepare self-employed workers’ accounts. Some lenders state the accountant must be certified or chartered – so bear this in mind when choosing one.
Make sure your credit is good
Make sure your credit is good and that you are permissible to be lent to. Determine how much you can afford and put your finances in place to allow you to get the maximum lend.
Understand your SA302
An SA302 or a self-assessment tax return is the equivalent of a P60 for an employed applicant. It provides the yearly income of the applicant. Since 2012, self-employed applicants are being asked for SA302’s by nearly all Mortgage Lenders. SA302’s provide lenders with a strong indicator of the affordability of a mortgage that is to be offered to the applicant or borrower. Speak to your accountant to obtain your SA302’s.
Shop around for the best deal
Make sure you shop around and find the right area and property that you will be happy with. This is an important decision and will probably be the biggest investment you make. You will want to make sure you get the right home, as moving homes due to being unhappy with the property you have chosen can be an expensive process.
Find a good Mortgage broker
A Mortgage company should ensure that their clients should get the right mortgage product that suits their individual needs. Moreover, all of the mortgage broker agencies should work with a strict set of values which revolve around the policy of treating customers fairly.