Self Employed Mortgages
One unexpected financial hurdle those new to self-employment have to overcome is mortgages. The vast majority of the time, the fault is not with the individual. Rather it’s the lender who doesn’t understand the way they work.
It’s scant consolation. But in truth, advisors at local High Street branches aren’t all to blame, either. Mortgage providers now have much stricter assessment criteria to work to than in the past. Straying from those guidelines can land them in hot water with the FCA.
Add to that the fact that most High Street mortgage providers work to a PAYE model and it gets worse.
So what’s the answer? Is it a lost cause? Of course not. But you do need a broker who understands how to do two things:
- identify lenders sympathetic to the self-employed;
- package your application in a way that proves your affordability, often with only one year’s worth of accounts.
Why you can’t get a self-employed mortgage: the bottom line
Self-employed people tend to be more tax-efficient than those in permanent employment. But to optimise tax-breaks afforded them, their accounts don’t always reflect their true worth.
The result is that their income, in the eyes of the average mortgage advisor, is laughable. Tax-efficiency: great for your tax bill; awful for credit! What do you do?
Well, selfemployedmortgages.com has turned the tables on this ridiculous scenario. They’ve sat down with underwriters to extract the positives. Now, a self-employed individual’s accounts can work for them, not against them.
They can secure an offer-in-principle within hours. They’ll also take it upon themselves to manage the whole self-employed mortgage application process. This leaves the client free to work, knowing that their earnings count for something positive. At least in the eyes of a mortgage advisor.
How (and why) they approach lenders differently
First things first: selfemployedmortgages.com are not a mortgage marketing firm or an aggregator. Nor do they work only on referral commissions. They’re certified mortgage brokers, authorised by the Financial Conduct Authority.
Their lofty status gives them access to the real decision makers, the underwriters. This has taken hours sat negotiating with lenders at the highest level to attain.
But it’s been worth it. They understand what it takes to underwrite mortgages for self-employed business owners like you.
As it turns out, it’s not as much as you’d think, but can differ between lenders. Mortgage providers have opposing views of what constitutes relevant earnings for affordability purposes.
What getting a self-employed mortgage entails
The first thing the advisors do is assess your circumstances. The task then is to match your application with a lender sympathetic to your situation. That could include years trading, your deposit, home value, current mortgage status, etc. The list goes on.
Lenders will process your application with as little as one year’s worth of accounts. But only if the broker in question packages your application to show your true net worth!
This is where many affiliates and marketers get it wrong. In reality, less is more. It’s not about hiding information; it’s being transparent about the important factors that counts.
The term self-employed is ambiguous, and this is half the problem. Sole traders, freelance professionals, company directors – all trade in their own unique way. What selfemployedmortgages has done is make mortgages accessible to all by removing this ambiguity.
If you’re serious about your business and conduct your financial affairs in a professional manner, this opportunity is for you. Yes, even if your efforts to date have failed to garner the response you were hoping for.
What you need to do next
The first thing their advisors will need to do is identify what your status actually is. You can pick up the phone and speak to one of their dedicated specialist mortgage advisors. Or, if now’s not convenient, leave your details in their “call-back” form.
As a rule of thumb, their advisors will need to know:
- the type and value of the mortgage you’re looking for;
- how you operate;
- your current and projected income;
- what you can present to the underwriters by way of documented accounts and/or SA302.
Once they collect those details and send only the copies of what mortgage lenders need to see through, you can relax. They’ll take over your mortgage application from that point for you. That’s everything from preparing the documentation for the underwriters in the first instance. Then, working with you every step of the way to completion and securing your home.
Don’t let the fact that lenders may have turned you down before put you off. The chances are you went through the High St or a broker who didn’t ‘get’ the way you work. Moreover, they didn’t know how to best present your earnings to an underwriter to get approval.
Find out how much you have the potential to borrow at www.selfemployedmortgages.com or on 020 8421 7994
psst! one last warning: the amount you could borrow may surprise you. In a nice way! Especially if you’ve walked into nothing but dead ends on the High Street up until now. We’ll say no more; instead, leave you in their expert hands.