Since the introduction of the new MMR rules in 2014 getting a mortgage has become much more difficult for both the self-employed and the employed alike. Below we list a few simple rules that you should follow in order to improve your chances of being accepted for a self-employed mortgage.
Control Your Spending – The majority of lenders will ask detailed questions regarding your spending habits and will want to see Bank Statements ( usually 3 months ) in order to verify your answers.
This doesn’t mean that you will be punished for having a gym membership or eating out at the weekend as they will be mainly looking at committed expenditure eg credit cards, car loans and overdrafts etc, but it doesn’t hurt to show that you have additional income left at the end of each month in order to prove that you can afford to make the repayments along with all of the additional costs associated with running a home.
Improve Your Credit Score – Clearing credit card debt, loans and overdrafts will not only improve your credit score but it will also leave you with additional disposable income at the end of each month, this will in turn allow you to borrow more on your mortgage should you need to do so.
It’s important that you do not miss payments, late fees and penalties will show up on your credit report and will undoubtedly hurt your chances of being accepted.
Save a Lager Deposit – It might not seem fair but saving a larger deposit will always improve your chances of being accepted for self-employed mortgage. The fact is that those with a larger deposit represent less of a risk to the lender and it also proves that you have additional income.
Find a Mortgage Broker – As we have mentioned before many times throughout this website each lender has varying criteria and it pays to enlist the help of an expert who has detailed knowledge of each and every ones.
Our mortgage Advisors will first assess your situation and then use our expert knowledge to apply to the one who is most likely to accept your application and we never charge a fee for our services. Contact a mortgage Broker today.