The self-employed mortgage maze

Research shows that many people avoid pursuing getting on, or moving up the property ladder out of fear of being rejected for a mortgage. 

Statistics show that over 40% of people in the UK who have been declined a mortgage feel it’s embarrassing and that somehow they’re a failure. 35% of people assume they’re not eligible or don’t earn enough, with 33% finding the process and advice they’re receiving too confusing or stressful.

It’s fair to presume that a large number of people who could potentially own their own home or upsize to their dream home are discounting themselves before even trying to apply for a mortgage. Yes, you can still find a mortgage if you are self-employed, but there are some boxes you need to tick first which is where having a specialist mortgage advisor helps in ensuring you save time and money.

Self-employed people do indeed have more complex needs when applying for a mortgage. For example, those who are limited company directors, sole traders and in partnerships are all dealt with differently by lenders. Businesses that fall under the high growth category may also be curtailed by a specific lenders policy, however, this shouldn’t result in delaying your next move.

Another common circumstance is self-employed customers paying the expensive standard variable rate on the assumption that they cannot get a better deal elsewhere because of their accounts, resulting in overpaying by thousands of pounds.

Some lenders may also require copies of accounts from up to 3 years, whereas some will accept accounts dating back 1 year. This is something that we can specifically assist with, as we frequently help first-time buyers and movers with mortgages by providing 1-year accounts.

Mortgage lenders are seen to be negative about self-employed customers and people sometimes act accordingly out of fear, without fully realising that there are great lenders out there who will embrace them.

As self-employed specialists, we work with entrepreneurs and company directors on a day to day basis. Sometimes company profits dip, dividends vary, new ventures come up, minor indiscretions on credit files happen. We can guide you to the best possible option for moving home, raising capital or simply securing the best rate.

Are you self-employed and need help finding a mortgage? Peter is our mortgage advisor and can help guide you through the process, tailor searches to suit your needs and help you find the right mortgage.

For more information or if you have any mortgage queries, get in touch with him below. 

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