Popular Self Employed Scenarios
We regularly work with a large variety of different self-employed mortgage customers, all of whom are in need of fast & friendly mortgage advice in Sheffield.
Below we have compiled a small selection of a handful of different scenarios that we have faced throughout our time as a mortgage broker in Sheffield, when speaking to applicants who are self-employed.
- As a self-employed owner of a business, you are being paid a combination of either salary, dividends or a directors’ loan.
- Your company is going through a rather hectic business period and you are in need of a trusted mortgage advisor in Sheffield to guide you throughout the mortgage process.
- You leave the majority of your net profit sitting in your company, rather than paying yourself a salary that is larger.
- Your business hasn’t been trading for more than one year.
- Despite having a really great credit score, for some reason you don’t seem to match the banks’ strict lending criteria.
- You’re a company owner, a director, a sole trader or you are a business partner, in need of self-employed mortgage advice in Sheffield.
- The bank is limiting the amount you are able to borrow and you need to borrow more than that amount.
- Your net profit is unsteady.
As a general rule of thumb, banks are not always the best place for self-employed mortgage applicants to go to seeking mortgage advice. These banks have automated systems and unfortunately, regardless of the length of time that you have been banking with them or the amount of money you often pay into your account, if you get declined, there’s not much more you can do with them.
It is at times like this where a mortgage broker in Sheffield can step in and see what they are able to do to help. Our dedicated team are able to match up your needs and current financial position to various lenders mortgage criteria, hopefully allowing your mortgage journey to continue.
Self Employed Customers & Bank Mortgage Advice
Pretty much every high street mortgage lender that comes to mind will use their in-house credit scoring policies when looking to allow customers to take out a mortgage with them. These credit scoring policies tend to be based on the mortgage lenders own experience and history during their tenure within the mortgage industry.
In doing this, they will take a look at previous mortgage repayment statistics, any information they have on repossession and other common patterns in order to determine what would be considered a high-risk when lending. This saves the lender both time and money, but unfortunately leaves many self-employed applicants 10 steps back when looking to purchase their dream home.
In years gone by, it would likely be safe to estimate that mortgage lenders have had a lot more self employed applicants fall into arrears than anyone who is a regular employee. On the flip side, it is also fair to point out that those employed applicants likely probably didn’t have as hard of a time trying to get a mortgage in the first place as self-employed applicants do.
If you’ve been doing some research, you’ll likely be aware that the vast majority of high street lenders out there have incredibly strict lending criteria, with many wanting to see your profits going up over a minimum of three years accounts, with some taking a three year average.
Whilst these rules don’t apply to all mortgage lenders (with some only requiring one years’), it’s always better to make sure you have a handful of years to go off just in case, as this will likely increase your chance of obtaining a mortgage.
Self Employed Mortgage Advice in Sheffield
Lending criteria can be completely different depending on the lender, regarding self employed mortgages. Our dedicated mortgage advisors in Sheffield will always work hard to ensure that you are appropriately matched up with the most suitable lender for your personal circumstances. We always aim to get this right the very first time!
Unlike a lot of the mortgage advisors in Sheffield that you may come across whilst researching the mortgage market, we’re proud to say with confidence that we work completely free from any estate agents. We work purely for you, tailoring our service to the customer in question. We will always have our customers best interests at heart.
Throughout our many years within the industry, we have gained a lot of experience with helping lots of limited company owners, sole traders, partners that receive a salary, dividends or a mixture of both. We use our expert knowledge to try and find solutions for those who really need help with their mortgage.
We are able to use our mortgage market expertise to find you the most appropriate mortgage for your personal and financial circumstances.
Having Mortgage Problems?
We regularly speak with customers who for some reason have found approaching their bank directly for a mortgage to be quite challenging. Some of the reasons that we have heard for this include;
- Failed banks criteria
- Fluctuating net profit
- Personal situation
- Bank won’t lend enough
- Pay structure
- Credit score
Definitely refrain from approaching various different lenders by yourself, especially if you’re unfamiliar with their lending criteria. Doing so can have a negative effect on your credit score and possibly even stop you getting a mortgage altogether.