Self Certification Mortgages

Self certification is for people who have difficulty proving their income. This could be because they are self employed and have not been trading long enough to show accounts, or they have more than one job or have income from sources not usually recognised by lenders (tips, pensions, investments or maintenance payments). There should be sufficient and sustainable income to support the mortgage applied for otherwise difficulties may arise with keeping up the mortgage repayments which may lead to repossession of the home and much if not all of the equity with it.

Self Certification mortgage usually have higher rates of interest and require a larger deposit (typically 25% of the property value), so if you can prove your income you are likely to be better off if you do not apply for self certification.

Do not be persuaded to say that your income is higher than it is to get a bigger mortgage. If you lie about your income, you could end up with a loan you can’t afford. You’ll also be committing a fraud and could get a criminal record.

Lenders will perform a reality check to determine whether the income you state is realistic - for example a part time cleaner stating £100,000pa will be challenged and proof of income requested. Creditors share information too, so if you state your income as £20,000 to one creditor and then £50,000 to another, this may be picked up on.

 

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