Welcome to part 6 of our 7 part series of blogs in which we set out to debunk the myths of applying for a mortgage. Click on the links below to catch up on the previous parts!
Read on for todays content!
"I'm self employed, so can't get a mortgage/It'll be too difficult or time consuming"
The UK is a land of entrepreneurs, start-ups and small to medium enterprises, if you are self-employed then you are a major factor in the recovery of the UK economy. The UK has 5 million people who are self-employed making up over 15% of the working population. Guess what? A large proportion of these workers own their homes and have mortgages!
The self-employed borrower is already a huge space for lenders and it is still growing. As lenders look to move into that market, they have launched products and designed policy that accepts the risk and understands the makeup of the income. If well-managed this is good revenue and good risk so yes, they do want you!
Furthermore, self-employed earnings are actually higher on average than the equivalent employed worker and a self-employed persons employment offers greater stability too.
To attempt to meet this need some lenders may consider one year’s books or an average of the last two, whichever is lower. They appreciate a dip in a year’s trading profits where equipment has been purchased, premises acquired, or money otherwise put back into the business. Lenders also take a view where profits are seen to be on an upward course.
These cases can be more involved but Foursquare have extensive self-employed experience and will be able to assess your turnover and profits to source a lender and borrowing best suited for you.
**Foursquare TOP TIP - If you are considering a mortgage or remortgage in the next 4 weeks order your SA302’s and tax overviews now. Whilst some lenders will accept online submissions, others do not and they can take up to two weeks to come through from the HMRC and we often end up having to wait**
Tune in tomorrow for more mortgage myth busters! 😊