Self-Employed Mortgage: What You Must Know?

Even if you work for yourself, you can still apply for a mortgage. Here’s how to increase the likelihood that your application will be accepted.

How can I get a mortgage if self-employed?

An actual product known as a self-employed mortgage does not exist. You will submit the identical mortgage applications as everyone else. The difference is that if you work for yourself, you’ll need to show additional proof that you have a steady source of income. While it can be difficult to obtain a mortgage while you work for yourself, it is not impossible. Just because you work for yourself shouldn’t result in higher mortgage payments.

If you can provide your income proof, mortgage lenders will get the confidence that you can make the repayments. Even if you are self-employed, you can get the loan at the same rates just like a full-time working professional. In general, interest rates depend on various other factors, not only on employment status. When the deposit is more, you will have a chance to get the loan at a better interest rate.

It is true that self-employed individuals do not have to pay very higher mortgage rates, but they have stricter requirements for them. This is particularly true now after the coronavirus breakdown. For instance, some lenders now require deposits from borrowers of up to 40%. The mortgage rates also depend on the factors like credit score. If your credit rating is good, you will have more options. If you are finding it difficult to get a mortgage loan, contact a mortgage expert right away. You can contact the experts from Right Mortgage UK, for finding the mortgage you are looking for.

What documents do you need for a self-employed mortgage?

Self-employed must present the same paperwork as everyone else. This includes

• Driving license or passport
• Last 6 months’ bank statements
• Utility bills (last 4 months)
• Deposit money proof

For sole traders, most lenders look at the net profit for the last 2 to 3 years. They will check the average for the last 2 to 3 years. If you belong to a limited company, most lenders consider the share you get from the company’s net profit or dividends and salary. If you want to improve your mortgage chances, below are some tips for you –

• Contact an experienced mortgage expert from a reputed firm. They will help you throughout the application process.
• Just watch out that your accountants don’t minimize your revenue too much to lower your tax payment. Your ability to borrow money for a mortgage will depend on how much money you make; the lower your income, the lower the profit. A sizable down payment will give you access to additional mortgage options.
• Improving your credit score is highly essential if you want to improve your chances for a mortgage. The first thing you must do for this is, close all your credit accounts.

Contact a reputed mortgage expert today to get the best assistance!