The number of people who are now officially labelled as ‘self employed’ is increasingly to record levels. These self employed individuals obviously either are trying to or have set up some sort of business venture. But this requires more investment than people would think and the costs just keep piling up.
Once everything has been said and done these self employed business owners usually have little financial resources left to your elsewhere. This is exactly why they are so keen about the self employed mortgage plan that financial institutions are offering.
Self Employed Mortgage – Taking Advantage
The biggest advantage of a self employed mortgage is that it enables these individuals a opportunity to buy their own home or invest in real estate. Instead of having to wait an unknown number of years to let the business settle down and savings to accumulate, a self employed mortgage can be used to make good on one of your other dreams. Almost 25% of all people in the United Kingdom are working for themselves and there are many advantages of working for you, however, one of the biggest disadvantage is the extremely low probability of obtaining a traditional mortgage.
People who work as employees, rather than being owners of the business, find it a lot easier to get a hold of mortgages because they have all the documents to back of their financial and income situation. They are more secure options for institutions offering mortgages because they are earning a fixed and known amount of money every month. On the other hand, self employed people cannot definitively state the amount that they will earn in a particular year because businesses can experience drastic ups and downs throughout the year.
Applying for a Self Employed Mortgage
However, thanks to the increasing supply of self employed mortgage products this problem is becoming less and less apparent. A self employed mortgage can be obtained as easily as you can show proof that you have been earning a decent amount of profit over the last three years of operations. And if your business has recently been established and you cannot provide proof of profit and revenues over this period of time there is no need to worry because you are also eligible for a self employed mortgage. In short, the process of obtaining a self employed mortgage is as simple as declaring the amount you will most probably earn in the coming year.
There is no need to supply authentic pay slips or bank statements; rather you can make an estimated based on the profits you have earned in the previous years. Nevertheless, a very important factor to keep in mind that if you intentionally over exaggerate the amount you plan to earn just to get a hold of a larger amount, you can be charged with fraud on a federal level. That said, you should only opt for a self employed mortgage if you know that your business will turn in a profit and you will be able to make the monthly payments.
