Selfcert Mortgage
Selfcert Mortgage | Is It What You Need As A Borrower?
Who needs a selfcert mortgage?
A selfcert mortgage is suitable for borrowers who, for one of a number of reasons, do not have a straightforward or regular salary. For example, self-employed borrowers who do not have more than three years' certified accounts may have to opt for a selfcert mortgage - if there are three years' accounts available, a selfcert mortgage is usually not required and a standard mortgage deal can be sought. According to the Office for National Statistics' Labour Force Survey, there were in excess of 3 million (3,337,000) self-employed workers in the UK in 2007 and numbers are steadily growing.
Who else needs a selfcert mortgage?
It might be however that you are not self-employed, yet your basic salary still does not represent your total earnings, in which case a selfcert mortgage will still be suitable. For example, you could receive dividends through shares in a company, large annual bonuses through a banking job in the city, or a significant part of your salary could be made up of commission, as is the case with an estate agent, recruitment consultant or sales executive. A selfcert mortgage would also be suitable if you derive income from more than job or earn extra cash from home doing anything from stuffing envelopes or to having a local ironing service.
Why is a selfcert mortgage so important?
In fact, with the average house price now at a staggering £186,044 according to statistics from Nationwide Building Society (October 2007), borrowers need all the borrowing capacity possible, whether its to make the first rung of the property ladder or climb up to the next one. A selfcert mortgage enables borrowers to use every scrap of their earnings, regardless of where from, in order to achieve this.
How does a selfcert mortgage differ to a regular mortgage?
Since all mortgages were regulated by the Financial Services Authority in November 2004, self cert lenders will want you to declare your income - or additional income - in order to qualify for a selfcert mortgage. Although a selfcert mortgage comes with greater flexibility in terms of what it will lend, providers of the products will still balance their risk by requiring a more significant chunk of deposit than would apply to a standard loan; a selfcert mortgage usually requires a minimum of 20 per
cent of the property value. That said some lenders require as little as five per cent for a selfcert mortgage if your credit rating is impeccable.
How easy is it to get a self cert mortgage?
Once borrowers are familiar with the criteria, getting a selfcertmortgage is easy - though using a specialist selfcert mortgage broker to guide you through the intricacies of each lender, what it offers and to whom, will usually result in saving time and money.
Due to increasing consumer demand and more flexible working patterns in the UK, the number of borrowers looking for a selfcert mortgage has soared. This means that competition among selfcert mortgage lenders is also fiercer that ever, which results in more attractive lending terms such as interest rates, tie-ins and flexibility of the selfcert mortgage.
