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Tips On Mortgage Loan Applications For The Self Employed

The self-cert mortgage isn't what it once was. It is quickly receiving flak from banks and lenders because of their nature of being less secure than normal loans, and the economy isn't helping. One may still apply and get approved, but it is going to take song and dance to do so.

An established business with many employees is considered stable. Most of whom are self employed run their business with little to no help, and thus don't have a lot of credibility in the eyes of lenders. If the business is new, odds are it will fail within a few years. Lenders already know this, and are extremely cautious in even thinking about giving out a new self-cert loan to a self employed individual.

Your income is going to be your selling point during a loan meeting. If you have a high income, and have maintained it consistently, you will be able to obtain the self cert mortgage without any qualms. Inconsistency worries lenders, since they will take it as a sign that one day you may see a drastic fall in income, and leave them with another failed investment.

A self cert loan is just like any other- your credit will be a critical factor in ranking your credibility. Having a good credit rating is normally excellent in improving your chances. With a self cert mortgage, this may not always be so, since lenders are looking for a great rating to help cover risk. You can still convince the lender with a good rating, however.

The representative that works with your case is more than just a judge who determines whether or not you get the loan- if you are approved they will also work with you to determine the monthly payment you will be paying. The best payment will be enough to quickly pay off the debts of the loan, but not so much that you will have to go through poverty just to make it through the month.

Competition in the lending business can be used to your advantage. You can negotiate better offers and rates as a result, leading you to benefit from the lender's misfortune. In the case of a self cert mortgage, you don't have this benefit since there is much less competition. Many key lenders have dropped out of the self cert mortgage business, leaving less competition behind. Deals are still there, but you will have to look harder.

Closing Comments

Mortgage loans for the self employed are going to take some effort in obtaining, but the process isn't impossible and is still worth your efforts. Start looking around your area for lenders who may offer this type of mortgage, and if so, ask for a quote.

Learn more on Self Cert Mortgage and Best Self Cert Mortgage Rate.