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Self Employed Mortgages

Getting a mortgage if you’re self-employed or a contractor can be more challenging, but it’s certainly achievable with the right advice. At Your Mortgage Options we take you through everything so you know how to improve your chances of having your application accepted by a mortgage lender.

In recent years, it has become increasingly harder for self employed homebuyers to get a mortgage. In the absence of an employment contract or any regular payslips, it can be more difficult to convince lenders that you’re a safe bet. But don’t despair – with a decent size deposit, sufficient planning and some financial discipline, it is possible to get a mortgage when you’re self employed or a contractor.

We are specialists in providing advice for self employed mortgages. Not only will we find and arrange the best mortgage deal for your circumstances, but our experts will guide you through the homebuying journey from start to finish.

When you’re self employed and looking for a mortgage, it is so important to get the right advice when it comes to buying a home. Being completely independent, we can search the whole of the market and approach the lenders most likely to work with your specific circumstances.

What is a Self Employed Mortgage?

There’s no such thing as a ‘self-employed mortgage’ as such, you’ll be applying for the same mortgage products as homebuyers who are fully employed. Up until a few years ago there used to be a specific mortgage product for self-employed buyers called a self-certification mortgage, but these were outlawed for being sold more extensively than they were supposed to be.

For self-employed applicants, mortgage lenders generally need at least two years of your accounts signed off by a certified or chartered accountant. However, the more records you provide, the better. If you can show a steady or increasing profit over a number of years, this will help your application, as lenders look at average profits over a period of time to assess your risk profile.

If your income varies from year to year, you might find that you need to provide further evidence of future income, such as new contracts or clients, or be able to evidence that you have a significant amount of savings. Speaking to a mortgage advisor will significantly increase your chances of getting accepted. Enquire online for self employed mortgage advice.

self employed mortgages

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Benefits Of Speaking To An Advisor about Self Employed Mortgages

Whole of Market Access

There are many different types of mortgages available, so only looking at deals from one lender means you’re unlikely to end up with the best option. Our mortgage advisors have access to the whole of the market, including products not available from high street lenders.

We Are On Your Side

We work for you not the lender and will act solely in your best interests. You can therefore be confident that the mortgage we recommend will be the best available product to suit your circumstances.

We Do The Hard Work For You

At Your Mortgage Options we leave no stone unturned in our whole of market research. We also handle the whole process end to end, including all the paperwork, solicitors and conveyancing.

We Consider Your Circumstances

We take the time to understand your individual circumstances. This helps us to find the right mortgage that works for you and your family. We will assess all that you can realistically afford and guide you through Your Mortgage Options.

Self Employed Mortgage FAQs

If you apply for a self employed mortgage and you’re rejected by the lender, it will be recorded on your credit file. This can be damaging to your credit score and, in turn, make it less likely that you’ll get accepted by the next lender that you apply to. At Your Mortgage Options we are be able to look at your personal situation and advise on the best lenders to apply to based on your credit history to help you secure a Self Employed Mortgage.

It is not a straight forward as a getting mortgage when you have a contract of employment as the lender will want to know more about your financial history and stability. A whole of market advisor will be able to guide you through the whole process of securing a mortgage, even when you’re self employed.

It’s important that you use a certified or chartered accountant to prepare your accounts. As some lenders won’t even consider applications from self-employed people who don’t have their up-to-date accounts signed off by an accountant.

When you’re self-employed, your situation will typically fall into one of three categories below. This will affect how a lender assesses you. If you’re thinking of changing company type (so for example, you’re a sole trader thinking of becoming a limited company), it’s often worth waiting until after you’ve been accepted for a mortgage to do this, as company changes can have an adverse effect on your application. This will vary depending on your articular circumstances, though, so talk to a mortgage adviser if you’re unsure.

Sole trader If you’re a one-man-band, you (or your accountant) will declare your income using self-assessment and have your tax calculated by HMRC. Once you’ve done this, you can ask for an SA302 form, which outlines your total income and tax paid. Lenders will then base their mortgage calculations on this information.

Partnership If you’re in business with someone else, mortgage lenders will look at your individual share of the profits.

Limited company If you form a limited company, you’ll be keeping your business accounts separate from your personal ones. As a director, you’ll usually pay yourself a salary and dividend payments, both of which lenders will take into account when you apply for a mortgage. If you choose to retain profits in the business rather than drawing them out, this can create difficulties, as some lenders don’t factor retained profits into their calculations.

Self Employed Mortgage Advice - Enquire Online