Self Cert Mortgage Gives Hope
If you are an individual who is not employed or does not have a regular source of income, then chances are you will have a hard time getting a regular mortgage. It would be almost impossible to convince lenders and bank managers - with their penchant for risk-averseness – to lend you money with the absence of a physical proof such as a pay slip or a certificate from an employer. This is regardless of whether or not your financial situation is healthy. It is in situations like this when a self cert mortgage would be very useful.
A self cert mortgage is ideal for individuals who are self-employed or do not have a regular income. In recent years, more and more banks and lenders have offered this type of mortgage in recognition of the growing self-employed market. Before, self cert mortgages are offered only by special types of lenders who provide very strict conditions and terms. Nowadays, self cert mortgages are being offered by regular banks and lending companies much to the delight of self-employed individuals who have long been dreaming of getting their own houses.
Aside from self-employed individuals, self cert mortgage is also ideal for those who work overseas. People who earn income that does not reflect on their monthly paycheck may also opt to get a self cert mortgage. It is also for business owners who intentionally pay themselves low for better tax management. Because of their minimal salaries though, these business owners sometimes find it hard to get a regular mortgage. The truth is; these individuals usually have higher income from dividends and other sources. Self cert mortgage is also applicable for those who prefer more flexible terms in payments that would allow one to increase or decrease the amortisation.
If you want to get a self cert mortgage, be ready to shell out as much as 25% of the cost of the house you wanted to buy as deposit. This rate is definitely much higher than the usual 5% charged in regular mortgages. It would also help, if you have a significant amount in your bank account as most lenders would often require you to present your bank history for the last three years. Other documents that may be required of you include you credit card statement and checks and bank statement. There are lenders though who would approve you mortgage through a simple certification that you can pay the amortisation regularly.
Self cert mortgage has some disadvantages. For one, the higher deposit requirement is probably too much for the regular self-employed individuals. But for many, a self cert mortgage is the only ray of hope for owning a home.
It is also predicted that in the coming years, the self-employed market would grow even bigger. Consequently, more and more lenders and banks are expected to offer self cert mortgages. This would also mean better services and better terms for self cert mortgages. Ultimately, self-employed individuals and small business owners would find it easier to have their own houses.
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