Self Certification Mortgage UK
Self Certification Mortgage UK | No Credit Crunch Mortgages
If you need a self certification mortgage uk you may have read scare stories in the press about self-cert products across the pond, and it's possible you could be concerned. But you should know that because of different market conditions and product features a typical self certification mortgage uk is not the same as the deals available in the States.
For example in the States a type of mortgage exists that is known as the ninja mortgage, which stands for no income, no job and no assets. This means that lenders enable people to borrow who may not have had the means to pay back a mortgage.
A self-certification mortgage uk is never lent on such a basis. Firstly, the borrower is usually required to have an income from a job in order to borrow in the UK. If they do not have a job they are expected to explain from where their income is derived - for example it may be from a trust fund or a divorce settlement.
Lenders here have strict rules regarding the amount they will lend an applicant in relation to their income. A typical figure on a self certification mortgage uk would be three or four times income or three times joint income.
High risk borrowers in the US were often lent money to fund the purchase of properties that were not of the highest standard, such as trailers, and in a difficult property market they did not rise in value - indeed some properties lost value, putting the borrowers into negative equity.
While nobody can guarantee that property prices in this country will continue to go up in value, a self-certification mortgage uk is almost always lent on tried and trusted bricks and mortar properties. These are known as AAA assets and are proven building materials that will last for a long time. Properties built from other materials are more difficult to secure a mortgage on in the UK, particularly on a self-certified basis.
Another key difference is that with a self certification mortgage uk the lender usually requires a significant deposit. This is usually at least 10% of the property's value and gives the lender and borrower a buffer against negative equity (where you owe more than the value of your property). In the US however, mortgages were lent at 100% of the property's value and because borrowers had no deposit they had no buffer zone against negative equity.
So you can see how a self certification mortgage uk has in-built safety features in the product design to protect both the lender and borrower from defaulting.
Finally, and most importantly is the advice process surrounding any self certification mortgage uk. Anybody advising on a self certification mortgage uk or any other residential UK mortgage is required to have passed professional examinations and to be fully authorised by the Financial Services Authority. So you can be confident that a self certification mortgage uk is a tightly controlled product that is perfect for a growing number of borrowers.
