What Is A Self-Certification Mortgage?

NOTE: the information below on self–certification mortgages is out of date. Since it was written, the Financial Conduct Authority, the UK regulator, now requires lenders to check affordability when receiving a mortgage application. Therefore UK mortgage lenders no longer offer self–cert mortgages as such. To comply with the regulations, they have the right to ask for proof of income to assess the affordability of a mortgage in all cases when you apply for a regulated mortgage contract. If you are unsure if you will qualify for a mortgage you should always seek advice from a suitably qualified mortgage advisor . Here’s the historic content. We’re leaving it online for the record.

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Historically, people who were unable to provide evidence of all their income have often found it difficult to get appropriate mortgages:

• They were offered mortgages that were too small
• They were refused completely

Self-certification mortgages provide a solution to this problem for many people whose full income cannot be guaranteed or documented.

Although self cert mortgages, as they are known, are often associated with self-employed people, in fact they are available to people from all walks of life, regardless of their employment status.

Self-certification mortgages are just like regular mortgages except for one thing:

You do not have to prove your income

All you have to do is provide a signed declaration of your income and your ability to afford the mortgage you are applying for:

 

• Your accounts will not be checked
  
• You will not have to prove your financial or employment status
  
• The only checks will be standard credit checks

 

Aren’t Self-Certified Mortgages Only For the Self-Employed?

NOTE: the information below on self–certification mortgages is out of date. Since it was written, the Financial Conduct Authority, the UK regulator, now requires lenders to check affordability when receiving a mortgage application. Therefore UK mortgage lenders no longer offer self–cert mortgages as such. To comply with the regulations, they have the right to ask for proof of income to assess the affordability of a mortgage in all cases when you apply for a regulated mortgage contract. If you are unsure if you will qualify for a mortgage you should always seek advice from a suitably qualified mortgage advisor . Here’s the historic content. We’re leaving it online for the record.

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No. It’s a common misconception that self-certified mortgages are only for the self-employed.

In fact, they are available to anyone who cannot or does not wish to prove their full income, but would like to be able to borrow an amount based on that income.

A huge range of people are eligible for self-certification mortgages. Here are a few examples:

 

• Employed people with more than one income – e.g. a part-time business, or several part-time jobs
• People with income from investments or pensions
• Seasonal workers
• Self-employed
• Freelancers and Contractors of any kind
• Company directors who are unsalaried
• Workers who are paid on commission only
• Workers whose annual bonus is a large part of their income
• Temp or agency staff, whose income varies and cannot be predicted

 

Self-certified mortgages are extremely flexible and simply require you to decide how much you can afford to pay each month and how much you earn, in total, each year.

 

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