Self Cert Mortgage - FAQ
Our experience the self certified mortgage market has indicated that many clients looking to self certify their income have very similar questions about the self cert mortgage process. Here we provide answers to some of the more common questions which you may like to peruse before contacting a professional mortgage adviser.
So what is a Self Certification Mortgage?
A self cert mortgage is a specialist mortgage product where you can declare your own income. This means that normally you are not required to provide the standard documentation that is more often than not mandatory with high street lenders such as payslips or accountants statements in order to prove the amount of your current earnings.
What’s the difference between a self cert mortgage and a non-status mortgage?
Firstly, there is no such thing as a non status mortgage anymore. This has now been replaced by the Self Cert Mortgage also known as fast track mortgage or no proof of income mortgage. The main difference between the old non status mortgage and the new self cert mortgage is that with non status you did not have to declare your income you only needed to sign a declaration saying that you could afford the mortgage payments.
What is the target market for the self cert mortgage?
The self cert mortgage was designed specifically at anyone who may have difficulty proving their income. The types of situation which the self cert mortgage applicant may find themselves in are as follows:
- Sporadic work patterns – Often caused by being self-employed and working as and when there is a demand for the work
- Lack of accounting records – This may be because of seasonal work
- Bonuses or commission – This typically refers to salespeople who may earn a different amount each month depending on how well they perform.
The significant advantage for people using a self cert mortgage is that they will not have to supply an employer statement or bank records in order to prove their income.
How is it possible to get a mortgage without proof of income?
The lender may require a different type of guarantee. This might be requested in the form of an accountant’s letter, landlord’s reference or bank references and the lender may well procure a credit check.
How do I know if a self cert mortgage is right for me?
A self cert mortgage may be correct for your circumstances if:
- You have been self-employed for less than three years
- You have more than one income stream You are a seasonal worker
- You cannot provide accounts for the last three years
- You work freelance You do not have a set, standard income every month
- You are a Limited Company Shareholder or Director and your income is mainly derived from dividends
However, the most important thing to do if you think that a self cert mortgage may be right for your individual circumstances is to get in contact with a self certification mortgage broker and discuss your possible future mortgage choices.
Tags: Self Certified Mortgages
