There are many reasons why you might want to get a mortgage just one year into self-employment. Perhaps you’ve spotted your dream property, and you don’t want to pass it up. Maybe you’ve had a successful year, and it seems like the right time to buy. Perhaps you’re simply looking at moving shortly, and purchasing a house is the best option for you. Whatever the reason, there’s no doubt that the process of obtaining a mortgage when you’re self-employed can be that bit more challenging – and doubly so when you’ve been trading for less than two years.
So when it comes to procuring that mortgage, what do you need to know – and what can you do to ensure you get that mortgage with less than two year’s trading? We answer all the questions below, so read on to find out more and discover precisely what’s needed to get that mortgage in place:
What’s the difference between an employed and self-employed mortgage?
The answer is simple: it all comes down to your finances. When you’re employed, your lender has the safety net of the fact that a company is paying you the same salary every single month. This means you have a stable, regular and guaranteed source of income. Exactly what they like to see when it comes to establishing how much of a mortgage you could afford. By contrast, self-employed people don’t have that safety net of a job contract and steady flow of income in many cases – which makes them a higher risk to lenders as a whole.
If you’re self-employed, this doesn’t mean you need to fear rejection from the off in the process of getting a mortgage. It simply means there are a few more hoops to jump through. Lenders always want the same information, regardless of whether you’re employed or self-employed: how much you make, and how much you can afford. That information is then used to calculate the figures that tell them if they can lend you the money or not. That’s all there is to it.
But when it comes to people that don’t have that history of self-employed or the years of invoices and income reports to back it up, that’s when the process can become tricky. Which is why our professional services as a broker are designed to support self-employed workers like yourself – ensuring you can access to the mortgage you want, without the rejection that going it alone can result in.
Getting a mortgage when you’ve been self-employed for one year
If you’re one year into your self-employment and enjoying a good flow of income and overall success, then getting rejected for a mortgage can be jarring. After all, you might be bringing in more cash than you ever did working for a business, but because you don’t have that crucial two year’s worth of Tax calculations, signed accounts or overviews, it’s an automatic ‘no’. That’s where our services come in – with over 30 years of helping clients with their mortgages we’re well-placed to help our clients find success in their mortgage.
At dsMortgages, we work for you and have access to over 90 of the UK’s top lenders to find and agree on a mortgage that works for you. Many of our clients are self-employed, and we’re experienced in devising and finding solutions that work for self-employed individuals. Generally, with a year’s worth of accounts, income reporting and projected profits, we’re able to support you to find a mortgage that meets your needs, fits into your lifestyle and matches your current income perfectly. No ifs, buts or confusing jargon included.
What about remortgaging now I’m self-employed?
If you’re currently self-employed, but you were fully employed at the time you took out your first mortgage, you may need to undergo all the affordability and credit checks required to make you eligible for remortgaging. Regardless of whether you’re sticking with the same lender of branching out to someone else. At dsMortgages, we can support you through the underwriting and remortgaging process to ensure your remortgage is precisely how you want it to be wherever possible.
Can I get a mortgage is I’m self-employed and have bad credit?
If you’ve been self-employed for at least a year and you currently have credit issues, there’s a possibility that you’ll still be able to get the mortgage you’re looking for. However, because of the increased risk, any lender will likely ask for more from you to agree to a mortgage. This may mean a higher deposit, as well as potentially higher interest on your payments overall. Depending on the severity of your financial issues, a mortgage may not be possible at this time – but it doesn’t mean it won’t be in the future.
If you’ve got a full record of your first year of income and accounts, and your credit issues aren’t too severe, then dsMortgages can support you in finding a lender that suits your needs in order to get a one year self-employed mortgage. We work with you to figure out what’s affordable and reasonable, and then advise you on the best path forward. With clarity and transparent processes, we’re better able to help you make the crucial decisions involved in getting a mortgage – and doing it all the right way the first time.
Do you need a professional mortgage broker when you’re self-employed?
If you’re considering using a broker for your mortgage as a self-employed individual, then dsMortgages is the service for you. Our friendly, professional and knowledgeable team are experts in helping our customers to obtain mortgages. From those new to the world of self-employment to those looking for a little extra guidance, we’re the ideal solution. With connections to over 90 of the UK’s lenders, we can find the self-employed mortgage that’s right for you.
Get in touch with us today on 0330 22 333 10 to find out more about how we can help you, or fill out our contact form, and we’ll get back to you as soon as possible.
Your home may be repossessed if you do not keep up repayments on a mortgage.
You may have to pay an Early Repayment Charge to your current lender if you remortgage