Finding the right mortgage to suit you can be a grueling task, but we are on hand to help.
If you think that a self-certification mortgage could be the one for you, here are the pro’s and con’s to help you make a decision. Prove it! • Self-cert mortgages allow you to ‘self-declare’ what you earn to a mortgage lender, without having to provide proof of income. • They are particularly useful for those with season jobs, self- employed people, or those who get a high proportion of their income through commission. • One of the attractions of a self-cert mortgage is that it can enable self-employed and employed people to apply for larger loans than they would get if they provided proof of income and received the standard income multiples offered by most mainstream lenders. I need more money • It is recommended to opt for a short-term deal of two or three years. Once the fixed term is over, you may meet the standard lending criteria and be able to switch to a lower rate. • Remember to be honest, it is a criminal offence to lie about your income when applying for a mortgage and along with a criminal record, you could also end up with mortgage repayments that you can’t afford. • Many self-cert mortgages offer options to make overpayments, underpayments and to take breaks which allows you to plan for times when your income is less. Deposits and interest rates • You may need to save a larger deposit if you choose a self- cert mortgage. The most that lenders offer is usually 85 per cent of the property’s value. • If you are a second-time buyer, there is the option of a fast-track mortgage, which is similar to self-cert in that you don’t have to prove your income, but you are in a position to put down a 25 per cent deposit. • Interest rates may be a little higher with a self-cert mortgage, compared to a standard mortgage. • Consider the implications of taking on a large mortgage at a time when interest rates could rise and if you could cope if your repayments rose.
Date: 6th, April, 2006
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ADVICE TO READERS
While this website is checked for accuracy, we are not liable for any incorrect information included. We recommend that you make enquiries based on your own circumstances and, if necessary, take professional advice before entering into transactions.
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