For the self-employed, obtaining a mortgage can feel like an uphill struggle. With lenders becoming more cautious, and borrowing rules and regulations becoming stricter since the financial crash, the self-employed have been one of the groups hardest hit. They must jump through many hoops, and be able to prove a steady income and have a healthy home deposit.
So, what can you do as a self-employed person to improve your chances of mortgage success?
Good credit track record
Maintaining a good credit rating proves to the lender that you are responsible. It will greatly increase your chances of obtaining a mortgage. But keep in mind, the lenders won’t just be running a personal credit check against you, but also your business – so ensure there are no unpaid debts lurking in the darkness at the time of your application.
Get your accounts in order
Generally, lenders will require at least two years of accounts – sometimes three. Therefore, having well-organised and up-to-date files is a must. If you want to score extra brownie points with the lenders, have a certified or chartered accountant handle your bookkeeping. This will save time during the application process and give the lender the utmost confidence in your financial affairs.
If you have not been self-employed for two years all hope isn’t lost – as long as you have healthy up-to-date accounts that show a steady workload some lenders will still consider your application.
Like having your accounts up-to-date, being able to evidence a consistent flow of paid work will always go down well with lenders – even more so if you can provide proof of a healthy pipeline of future work.
Seek professional mortgage advice
An independent mortgage advisor can search the whole of market on your behalf and knows the lenders who are more likely to lend to the self-employed and those that offer more flexibility regarding number of years of accounts needed. They can use their insider expert knowledge to source you the best mortgage deal available that suits your lifestyle and circumstances.
If you are self-employed and want to secure a mortgage but having trouble, contact one of our expert advisers today. We are used to dealing with tricky situations and would love the opportunity to help you solve your issue. Call us on 01639 262222 or click here to send us an email.