The self employed are, on average, a look at how some individuals can shatter the mold and make their dreams a reality. That being said, there are still clear disadvantages that being self employed will harbor. One being that getting a mortgage loan could prove to be a difficult endeavor.
One reason why lenders hesitate in giving out mortgage loans to self employed individuals is that their jobs may be considered unstable. Even a business that is currently prospering could take a turn for the worst a few years down the road, and cause risk to the lender as a result. Loan officers like to go as far back in possible in researching income and responsibility in this case, so it's good to have your information at the ready.
Lenders are making an investment in self cert loans, and they like to investigate as much as possible before agreeing to offering them. Proof of income is an important method in proving your credibility. If you aren't able to prove income, you could easily be denied on the basis that you may not be able to pay the mortgage loan without sufficient funds.
Credit, like any loan, is another big determining factor. The problem with self cert loans is that they already have lenders on shaky grounds. While you could have gotten a mortgage loan with fair credit, doing the same with a self cert mortgage will be a task. Generally your credit should be above average, and if possible, near a perfect score for approval.
The representative that works with your case is more than just a judge who determines whether or not you get the loan- if you are approved they will also work with you to determine the monthly payment you will be paying. The best payment will be enough to quickly pay off the debts of the loan, but not so much that you will have to go through poverty just to make it through the month.
One thing you may have to face is a lack of options. Compared to other loans, lenders are just not offering the self-cert loan as much as it once was. Due partially to irresponsible lending, lenders soon found that self-cert loans could cost their institution quite a bundle once the individual would default. There are still lenders out there today who offer them, but many have withdrawn their presence in the market completely.
In Conclusion
Make a list of lenders in your area and visit each one to see what they could offer someone who was self employed. If you are eligible, ask them to give you a quote and once you finish your rounds, compare all the quotes you received and make a decision.
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