Self-Certification

Some 15% of the working population now count as self-employed. The traditional route for the self-employed to get a mortgage was to present three years of trading accounts. However, in many cases this can be difficult. Even if these accounts are available, they would be likely to be written in such as way as to minimise tax and thus show a smaller income figure.

Self-certification requires that you state what your likely income will be, rather than providing documentary evidence. However, even without providing accounts you may be asked to have an accountant back up your statement.

Although standard mortgages are typically offered on a 95% loan to value basis, self-certification mortgages almost always require a higher deposit: a loan-to value of 90% and, more commonly, 75% is usual.

The good news is that because you are putting up a substantial deposit, your word will be taken rather than having a lender scrutinize your financial life in detail.

Last Updated: March 2008 © Moneyextra.com

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