Many self-employed people often put off their plan of buying any property due to a certain common belief that obtaining a mortgage for a self-employed person is almost impossible. However, that is not true!
The truth is, if you are self-employed, then it will not make any mortgage lenders reject your application. However, you need to be a little more organized while approaching a mortgage and manage your finances.
Here in this post, we will explain how you can also apply for sole trader mortgages if you have decided to buy any property for yourself. Mortgage Experts Online can also offer you the necessary advice if you need any kind of mortgage.
What should self-employed people do to better their mortgage chances?
If you are a self-employed person and seeking a mortgage, then read the following:
- Speak to a broker
Every lender may not fall under the same criteria, and hence consulting with a broker can ensure that you will be matched with all the requirements of a most suitable lender. So, you must discuss with an experienced broker in self-employed mortgage and get more awareness about various lending criteria.
- Ensure you are registered on the electoral roll
You must check with the local council, as this can help with your credit score.
- Check your credit score.
You must make sure that no adverse entries are present against you, particularly the one that perhaps you may not be aware of. Remember that your credit score is a very important factor and helps you to decide which products to apply for and whether you are eligible for the best rate and deals.
- Ensure that all your accounts are up to date
If you want to get the most competitive rates, then you must have a very good credit record, so ensure that everything is paid by you on time. It is always a good practice to put on direct debit for everything.
- Prepare your accounts through an accountant.
Often many mortgage lenders, particularly in the case of self-employed mortgage applicants, like to see your business accounts that are approved by any chartered accountant.
- Stay away from any payday loans.
Always stay away from payday loans, as such loans offer a poor picture of your finances. All lenders will treat this as you were in financial difficulty. Often many lenders may straightway reject your application if they notice any recent payday loans record.
- Avoid your credit card to go beyond its limit.
If you use your credit card more, then also it will result in a poor credit score. So, better you spread your outstanding balances across two cards.
- Sort your deposit early
Be prepared with all papers, especially if you received any gift from family members for your initial deposit.
- Get yourself an agreement.
Many estate agents will not allow you to see the property without an agreement for a mortgage. This can confirm your maximum loan so that you have peace of mind and look at properties that are within your budget.