What Are Self Certification Mortgages?

Self-certification mortgages have been produced by mortgage lenders to let homeowners 'self-declare' or 'self-certify' their yearly earnings.

Self-certification mortgages were more aimed for the self-employed and homeowners who had small businesses, however could not justify their two years of income.

Are self-certification mortgages aimed at people with businesses only?

This is not the case as people who have an unbalanced income could be adequate for a self-certification mortgage. For example, people who have small businesses running this seasonally through the year or people who get paid more i.e. commission, would find it more difficult to prove their salary. Those who obtain large Christmas bonuses, or people whose salary comes from a total of different sources may also choose a self-cert mortgage deal.

What is the self-certification process?

Self-cert mortgages involve the borrower or borrowers to confirm how much money they earn when completing the mortgage application form. At times the borrower may not be told to prove this, the lender might ask for business bank statements to ensure the gross income received. Current mortgage holders will also be asked to provide some kind of identification and proof.

Why are self-cert mortgages more different to other standard mortgage deals?

If you were looking to take on a self-cert mortgage, you as a borrower would have to lay a heavy deposit and generally end up paying a higher rate of interest. Most lenders would need a big deposit, normally 75 - 85 per cent of the value of the property, as these figures tend to fluctuate. Interest rates are considerably higher to correspond the risk when giving out such loan.

Is it a good idea to false my earnings?

If you borrow money from a firm and decide to complete the application with trends of false judgements, this is a criminal offence. This part of the product has caused many problems before, and the Financial Services Authority have started to make further reviews. The FSA are people who analyse self-cert and their job is to encounter any fraudulent activity. Making false judgements will only cause the borrower to slip into debt and end up with bad credit history.

For more information on self certification mortgage please visit http://www.mortgages-uk.eu or for a Mortgage Quote please visit http://www.mortgagequotes.me.uk

This post was made using the Auto Blogging Software from WebMagnates.org This line will not appear when posts are made after activating the software to full version.