The self-employed have always faced significant hurdles when it comes to obtaining a mortgage. With the introduction of new rules for mortgage applications under the MMR, it seems that sentiment among self-employed people looking for mortgages is currently running at its lowest ebb. Stories of 3 hour grillings from bank staff who pick over every aspect of one’s financial life have been making headlines everywhere.
But we don’t think this negative outlook on the part of self-employed homebuyers is quite justified.
High street lenders shied away from offering large mortgage loans in the wake of the financial crisis. Lending a large sum to a single individual is seen as more risky than spreading the risk over several smaller loans. Recently though, buoyant property prices have coaxed these lenders back into the large loan market and buyers looking to apply for mortgages of £1m plus are finding themselves with more choice than ever.
Due to the highly specialised nature of the work they do and the unique circumstances under which chambers operate, barrister mortgages constitute an important subset of the work that mortgage brokers carry out.
Specialist advice on both the selection of mortgage product and how to present earnings as part of a mortgage application are invaluable for professionals who often don’t have the time to fully research the complexities of the market.
So you’re looking for a mortgage? Or perhaps more importantly you’re actually looking for a mortgage broker, although you might not realise it yet. Looking for a mortgage is a daunting task. From variables and trackers to base rates and fees. Is it a minefield? Hopefully not if you have the right broker. Our speedy guide to finding the right mortgage broker should allay imminent pitfalls.
A wide range of deals
Finding the shining star in a sea of brokers is not easy. Henry Knight, Managing Director of Springtide Capital reveals that while most mortgage brokers will have access to the percentage of the market, some will operate on restrictive panels. Choose one with a wider range of options available and they’ll be the one most likely to help.
Experience it all
What kind of experience do they boast? If you are in need of a slightly more complicated deal you need a mortgage broker who can bring a hefty level of market experience. Don’t be afraid to ask.
It pays to know
You need to know what broker fee levels you are paying. This is incredibly important to find out before you have your first meeting; because not only are you paying fees associated with the mortgage, but you need to know what advice from your broker might you be paying for too.
Are we there yet?
Mortgage applications are taking longer to process. Read our blog post on that here. You should always as your broker how quickly they think they will be able to process your application. It’s crucial to make sure your application has the best chance of being processed as quickly as possible in a market as buoyant as this.
What kind of strategy and methods does the broker and its team have in place to handle your application if something goes wrong? Ask them to be specific about their relationships with particular lenders. Make sure you note their experience in case your application gets tricky.
The instincts of most contractors, when faced with the question of how to obtain a mortgage, are overly pessimistic. Mortgages for the self-employed are generally viewed by those in search of them as unrealistic pipe dreams, reserved only for the lucky few.
But are these sentiments of doom a realistic assessment of the current contractor mortgage market? Or is it the case that mortgages for self-employed individuals are actually relatively easy to obtain, provided you go about applying in the right way?