It is an aim for many people to get onto the property ladder. This is difficult enough for first-time buyers but harder for people who are self-employed. While the business may be profitable at the moment, this can change rapidly; when you are self-employed, there is the benefit of the steady income each month. However, it isn’t impossible to get a mortgage and here are five tips according to Mis-Sold Mortgage Specialists Hardwick Finance to secure one.
Look for Companies Specialising in Self-Employed Mortgages
Some lenders specialise in the higher risk so keep an eye out for them. The interest rates are likely to be higher but you will be able to get onto the property ladder. You could also talk to your current bank about getting a mortgage through them and the steps that you will need to take to secure one. They will have full access to your bank details and see how well your business has done over the last couple of years. Many lenders advise waiting three years to build up stable accounts.
Get a Joint Mortgage
Talk to someone who is credit-worthy about getting a joint mortgage with them. This will need to be someone that you trust – and who trusts you. Consider someone close like a partner, parent or even a child. They will need to be in full-time employment and have a good credit history to help you gain the mortgage. There are risks to this, including the fact that they will need to make the decisions with you about the house, including extensions, selling and renting prospects.
Have a Larger Deposit
The more you save, the more chance you have of gaining a mortgage. This also works in your benefit since you will borrow less so pay less over time and each month. Lenders are more likely to let self-employed people borrow money when they have saved up a larger deposit since they have already proven to be sensible with their finances.
Have an Emergency Fund
You never know if your business will struggle one month – or even for the year. This is the thing lenders are worried about so prove that they shouldn’t be by having an emergency fund. This should be enough to cover the mortgage payments for a few months while you help your business find its feet again. The more you save, the better off you will be.
Have a Proven Track Record
Most lenders as for three years on the books for a reason – you can prove your track record. The longer you wait, the more you can prove that your business is doing well and you do have the money for the home loan. It may be worth talking to a financial advisor to make sure you are ready.
Take your time in getting the mortgage. While you may think there is a rush, waiting could save you money with lower interest rates and will give you more proof on the books that you are a sensible borrower. Prove that you are a lower risk than self-employed people are perceived to be and you have more chance of being told yes.
Alex writes many finance articles for Hardwick Mis Sold Mortgages. She has written many articles on mortgages as well as a wide spread of information related to mortgage scandals and gaining loans while young and self-employed. Hardwick Mis Sold Mortgages helps people gain compensation for their mis sold mortgage. They work for the clients to help them gain compensation.