Mortgages for self-employed

Whilst there aren't many differences between applications for employed and self-employed people, we thought it would be good to give self-employed clients a heads up on what the differences actually are.

How we can help.

In some circumstances self-employed clients may find it challenging to arrange a mortgage. As many of our clients are self-employed, we have amassed knowledge and experience in sourcing appropriate mortgage products.

Step 1: Getting to know you

The first and most important step in the journey is for us to get to know you and understand exactly what you require. We’ll need to talk about your current financial circumstances, how much deposit you have and the types and cost of the properties you are interested in. If necessary, we may also need to address you credit history. Don’t be put off by this. By getting to know you, we can provide the tailored service you need and it makes our research for you a lot easier. We will ask you to gather ‘proofs’ that are required for the full application, like ID, bank statements and proof of income. How a self-employed client proves their income is through business bank statements and (in most cases) providing two years’ Tax Calculation and Tax Year overviews.

Step 2. We’ll do our research

We have access to a wide selection of mortgage lenders including lenders that you won’t see on the high street. Even if you have had adverse credit in the past, we may still be able to find you a mortgage. In the majority of cases, you’ll have a choice of lenders. We’ll talk you through the options and help you decide which is the best option for you.

Step 3. Decision in Principle

Once you have agreed an option, we will organise a decision in principle (aka DIP or AIP – agreement in principle) with the chosen lender. A DIP/AIP is an initial agreement from the lender to provide you with a mortgage, providing you satisfy the full application criteria. Having this information will make your house hunting easier.

Step 4. Full Application

When you find your dream home, you will instruct your solicitor to make a formal offer. If your offer is accepted, we can complete the full application. We’ll ask you for any ‘proofs’ we don’t already have, and for any additional information required by the lender. All being well, your application will be accepted and the lender will provide you, you solicitor and us with copies of the full mortgage offer.

Step 5. Completion

You and your solicitor will negotiate a date of entry with the seller. The solicitor will then make arrangements with you to transfer the deposit to them in time for the settlement date. You’ll also need to supply the solicitor with a cover note for building and contents insurance which all lenders require as a condition of your mortgage and we can provide you with quotes. In addition, as a self-employed client, we’ll have discussed not only life insurance but also income protection, particularly if you are a sole trader and can provide quotes as required.

Step 6. Keys in hand

On the agreed entry date, you’ll pick up the keys to your new home. Congratulations!

And that’s it! Get in touch today and let’s find your mortgage!