A self certification mortgage or remortgage means if you are self- employed, you may simply not be able to prove your income in a form acceptable to a mortgage lender.
For example you may not have formal or recent accounts or accounts prepared by someone without the prescribed qualifications. You may also be an employed or self-employed person who has some buy to let or investment property income.
Whilst originally intended for the self- employed, the concept has now been extended to incorporate the employed market. For example, those who get a large proportion of their income from non-guaranteed sources such as bonuses, commissions and other allowances.
A self-certification mortgage is ideal in this situation, as the lender will normally allow 100% of such income into the affordability calculation.
Traditionally, most high street mortgage lenders have taken a cautious view of the self-employed or others who find it difficult to confirm their income. Moreover, fluctuating bonuses or commissions might not be considered as permanent income and excluded from the affordability calculation altogether, or at best only allow half towards the income multiplier.
Lenders that operate in the self-certification market will use a similar method of underwriting to the mainstream lenders. However, as they do not ask a potential borrower to prove income, a larger deposit is required to reduce the perceived risk from a lender perspective.
Don’t forget though, arranging the mortgage is one thing paying for it may be another, in all cases it is essential that you can afford the repayments each month.
At MortgageMap we do not arrange mortgages for people but have a national network of Mortgage Advisers whom we can introduce you to. They know which lenders will accept your circumstances, who offers the best rates and who will provide the quickest service.
Please complete the relevant enquiry form if you would like to speak to an adviser.
Mortgage Enquiry Form
Remortgage Enquiry Form
Mortgage Calculator
SELF CERTIFICATION