Is it Harder to Get a Mortgage if you’re self-employed?
This answer depends on the person! However, usually, it does require extra steps for an individual to apply for a mortgage that only gets income from their own means instead of a larger company. Although money is still money, banks want to feel protected.
What Makes it Hard For Self-Employed Individuals to Get a Mortgage?
It is not difficult out of malice but necessity. The banks are a business and, at the end of the day, want to ensure that they are making the right choice by investing in you. Since self-employed individuals do not have payroll and cannot provide slips with proof of fortnightly pay, then they must submit additional paperwork.
For an up-and-coming business that is still trying to open and thrive, it may not be possible for them to get the necessary paperwork. Individuals, for instance, who do not have many years of experience as self-employed individuals, may have a limitation when it comes to the amount they can borrow or their interest rate.
What to Do When Looking for a Mortgage as a Self-Employed Person
If you are self-employed and are ready for a mortgage, take a deep breath! There are a lot of banks and lending companies that will happily do business with you. The first step, however, should be to use a Mortgage calculator. These are online and can give you a glimpse of what your monthly rates will be when purchasing a home. This can help you make a stronger decision.
After you understand what the payments will look like, you can move on and contact a self-employer friendly bank. Not all banks are equipped with the right knowledge and may not be a good match. Always take your time and ask the right questions!
Remember, at the end of the day, you are the one who can decide on your lender company! While it is more difficult to find a lender when you are self-employed, it is not impossible! If you do your research and have the appropriate papers, you will be ok!