If you’re self-employed or run your own business, getting a day rate mortgage can be trickier than usual.
How can I get a self-employed mortgage?
If you’re self-employed and are looking for a mortgage, you can still apply for the same range of mortgages as people in employment.
Mortgages for Limited Companies
There are many reasons why businesses – and individuals – want to invest in property and mortgages for limited companies help them do so in a way that’s tax efficient.
Mortgages for Sole Traders
If you’re a sole trader and are looking for a mortgage, you can still apply for the same range of mortgages as people in employment.
Mortgages for contractors
If you are a contractor and are looking for a mortgage, you can still apply for the same range of mortgages as people in employment.
Mortgages for freelancers
If you are a freelancer and are looking for a mortgage, you can still apply for the same range of mortgages as people in employment.
Mortgages for directors
Mortgages for directors are often among the most difficult to obtain because of the way many lenders view self-employed company directors.
Mortgages for LLPs
Mortgages for LLPs (Limited Liability Partnerships) have increased in popularity in recent years, both for investment purposes and for the purchase of residential property.
What is a Self-Employed Day Rate Mortgage?
First things first, we’ll let you into a little secret… there’s no such thing as a self-employed mortgage.
If you’re self-employed, you can still apply for the same mortgages as those who are in employment, you’ll just need to jump through a few more hoops.
That’s because mortgage lenders will want to be sure you can afford the monthly repayments, so will require proof of the self-employed income you receive. Most lenders are happy to give mortgages to self-employed people who have been trading for at least three years and have at least two years of audited accounts or self-assessment tax returns available.
Why do I need a Self-Employed Mortgage?
Until just a few years ago, if you were self-employed and looking for a mortgage, you could apply for a self-certification mortgage. These were designed specifically to allow self-employed people to self-certify their annual income, with no need to provide evidence. However, ‘self-cert’ mortgages were banned in 2014, following concerns that borrowers were being accepted for mortgages they couldn’t afford.
It means that now, if you’re self-employed and are looking for a mortgage, you need to apply in the same way as someone in employment, and be able to prove you have a steady annual income from your work. Most lenders will consider you as self-employed if you are a sole trader, company director, or contractor and own more than 25% of the business from which you earn your main income.
You’ll need to pass the lender’s affordability requirements to get a mortgage offer, but because you don’t have an employer to verify your income, you’ll need to provide the evidence yourself. That means the longer you have been trading, and the more years of accounts you have, the easier it will be to satisfy the lender’s criteria.
If you’ve been declined a mortgage by a high street lender because you’re self-employed, you’re in the right place. My Mortgage Pro can connect you to an expert mortgage adviser who can give you the right advice to suit your circumstances, before finding a specialist lender and the mortgage that’s right for you. We work with a panel of specially selected mortgage professionals who have many years’ experience in securing mortgages for the self-employed.
We can connect you to a mortgage broker with the right skills and expertise to scour the whole mortgage market to secure the best deal for you.
So, if you are self-employed and have struggled to find the right mortgage, get in touch today. We’ll hook you up with an authorised and regulated mortgage adviser who specialises in self-employed mortgages and can find the best lender and mortgage deal to meet your needs.