Self-Certification Mortgage Guide

This information is provided to give you an overview of the Self Certification Mortgage Guide available in the market. However, it is far from all-inclusive and therefore you should try to take your mortgage decision after seeking professional advice in order to determine the most suitable mortgage for you.

Advantages

• A mortgage can be obtained when it would otherwise not be offered.
• Higher lending than possible under normal income multiples.
• Quicker offer of advance, as not so many checks to make.

Disadvantages

• This is a risky area of lending. Such loans are therefore characterized by higher rates of interest.
• The loan-to-value ratios are usually lower than types of mortgage. i.e. larger deposits are required.

For whom self-certification mortgages are most suitable?

Self-certification mortgages are available for clients who cannot verify their income. This may be because the income comes from a number of sources, or they may have a low basic salary but achieve bonus or commission payments or a regular second income. Typically the self-employed may be unable to prove their income by way of certified accounts or they may not have been trading for long enough to have the required number of years’ accounts.


Consequently, some lenders provide mortgage finance on a self-certification or non-status basis. Self-certification means that the earnings figure declared on the application form is accepted by the lender without proof. Non-status means that the loan applicant does not provide earnings information at all. Credit checks will be conducted and previous lenders’ references may be sought in both cases.

Please also note that you need to be frank with your facts and figures. It should be remembered that it is a criminal offense to lie about your income especially when you approach for a Self-certification mortgage.