SELF EMPLOYED MORTGAGE

Avoid the confusion

SELF EMPLOYED MORTGAGE

Avoid the confusion

Being self-employed brings many rewards in life but not when it comes to buying a home, and the confusion surrounding self-employed mortgages effects thousands of applicants each year.

While there are a handful of additional obstacles to consider along the path to success, it is usually still possible to reach the dream destination of getting a mortgage. Here’s all you need to know.

Which Lenders Offer Self Employed Mortgages?

The good news is that most banks and mortgage lenders will allow self-employed workers to borrow money. This means that, despite the perceived lack of options, you should have no problems finding a lender – as long as you meet the criteria.

Remember, though, that all lenders have their unique policies. So, just because one bank doesn’t offer self-employed mortgages, it doesn’t mean you should give up.

What Additional Challenges Will I Face During The Self Employed Mortgage Application?

Lenders need to verify your earnings. This is very easy when applying for a mortgage under traditional employment but can be a little more difficult when you’re self-employed. Most lenders will want to see earnings reports for at least 2 years, and potentially up to 5 years.

Your tax accounts are the best way to prove earnings, but it’s important to keep financial records too. On a separate note, lenders will want to know that the earnings are set to continue, which is why contracts for future employment – as well as similar documents – can work wonders.

How Much Can I Borrow On A Self-Employed Mortgage?

As a rule of thumb, most lenders will lend up to a maximum 5 times your annual earnings – although many set their limits to 4 or 4.5 times the earnings.

The earnings are ordinarily calculated by taking the mean average from the last 2-3 years, as per the figures on your financial records. Meanwhile, those that are making joint applications with their spouse can add the earnings to their partner’s before adding the multiplier.

Should I Speak To A Mortgage Adviser About A Self Employed Mortgage?

Definitely speak to mortgage advisers. Even if you have a basic understanding of mortgage rates and know how to prove your earnings and steady work status, an expert can help you find the best rates from the best lenders while also supporting you through the preparation of the application.

Their word can extend to helping you compared fixed rate and standard variable rate deals, along with other key factors to ensure you gain the very best self-employed mortgage agreement. If nothing else, it should provide you with peace of mind

What Can I Do In The Meantime?

Collecting and collating your financial records is a great starting point while you should also use this opportunity to build a strong credit score and a larger deposit. Those two features will open up far greater opportunities regarding the interest rates and the likelihood of approval.

Moreover, it’s important to be clear about whether you’re a sole trader, partner, or owner of a limited company as this will impact the way lenders view your application.

These articles are for information only and no advice should be conferred from the content within. Please seek independent financial advice prior to taking any action.

Want To Know More?

Are you ready? Find out today

Your dream home/new investment is waiting for you…

Active Mortgage

Make It Happen

Active Mortgage

Make It Happen

Registered in England & Wales under Company no: 06539910

Registered Address: 4, The Capricorn Centre, Cranes Farm Rd, Basildon SS14 3JJ

FOLLOW US

IMPORTANT INFO

Think carefully before securing other debts against your home. Your mortgage is secured on your home, which you could lose if you do not keep up your mortgage repayments.

We will charge a fee for mortgage advice between £250.00 and £2000.00. The amount we charge is dependent on the amount of research and administration that is required. Please refer to the Customer Terms of Business for further information.

Active Mortgage is owned and operated by Active Brokers Limited and may contain advertisements, sponsored content, paid insertions, affiliate links or other forms of monetization. Active Mortgage abides by word of mouth marketing standards. We believe in honesty of relationship, opinion, and identity. The compensation received may influence the advertising content, topics or posts made in this blog. That content, advertising space or post will be clearly identified as paid or sponsored content.

Active Mortgage is never directly compensated to provide opinion on products, services, websites, and various other topics. The views and opinions expressed on this website are purely those of the authors. If we claim or appear to be experts on a certain topic or product or service area, we will only endorse products or services that we believe, based on our expertise, are worthy of such endorsement. Any product claim, statistic, quote or other representation about a product or service should be verified with the manufacturer or provider.

This site does not contain any content which might present a conflict of interest. Active Mortgage makes no representations, warranties, or assurances as to the accuracy, currency or completeness of the content contain on this website or any sites linked to or from this site.

YOUR HOME OR PROPERTY IS AT RISK IF YOU ARE UNABLE TO MAINTAIN PAYMENTS ON ANY MORTGAGE OR LOAN SECURED AGAINST IT.

Request a strategy call

Discover how we can help you to secure the finance you need to create your dreams. Let's make it happen.

You have Successfully Subscribed!

Request a strategy call

Discover how we can help you to secure the finance you need to create your dreams. Let's make it happen.

You have Successfully Subscribed!

Request a strategy call

Discover how we can help you to secure the finance you need to create your dreams. Let's make it happen.

You have Successfully Subscribed!

Get Finance Fit

Start preparing for your succesful finance application

You have Successfully Subscribed!

Send The Resources!

You have Successfully Subscribed!

Send My eBook!

You have Successfully Subscribed!

Download our brochure

Discover how we can help you to secure the finance you need to create your dreams. Let's make it happen.

You have Successfully Subscribed!

 

Send my eBook

When you submit your details you will receive the 7 Mistakes eBook immediately via email!

GDPR Consent
Marketing by

You have Successfully Subscribed!

Speak to an Expert

When you submit your details you will be contacted by the active bookings team to arrange a convenient call with an Active expert.

GDPR Consent
Marketing by

You have Successfully Subscribed!

Download our brochure

Once you have submitted your details you will be sent an email with the brochure attached.

GDPR Consent
Marketing by

You have Successfully Subscribed!

Buy The Self Employed Mortgage Guide
GDPR Consent
Marketing by

You have Successfully Subscribed!

Send the book resources

When you submit your details you will be sent an email with The Self Employed Mortgage Guide Resources.

GDPR Consent
Marketing by

You have Successfully Subscribed!

Download our brochure

Once you have submitted your details you will be sent an email with the brochure attached.

GDPR Consent
Marketing by

You have Successfully Subscribed!