If you are self-employed, you can still get a mortgage on your property. There are upsides and downsides to having your own business. There are great tax benefits when it comes to being self-employed but the same business owners have to struggle to qualify for loans and mortgages as their income is significantly smaller on paper than the actual amount. There are a few steps you can implement to get a self-employed mortgage.
- Decide the source of the self-employed mortgage.
The source of the self-employed mortgage may be a mortgage lender or a mortgage broker. The mortgage lender will only offer you the money for the self-employed mortgage. He will not be able to help you with any sort of documentation and other procedures but this method will reduce any commission payment. A mortgage broker, on the other hand, will help you find the lender and also help with the procedures.
- Check your tax bracket.
One of the many documents required by a lender to approve and finance your self-employed mortgage is your tax statements for the previous two years. You must ensure to increase the income on paper to be eligible for the required mortgage plan. You can try writing off fewer expenses before the year leading up to the purchase of the property to be eligible for the self-employed mortgage.
- Make sure you have all your documents in place.
The documents your lender will require are identification proof, proof of employment, proof that you can repay the mortgage, documentation of your other assets and documentation of other loans and debts you have under your name. This is mainly to ascertain your financial position and see if you are eligible for the self-employed mortgage
- Be clear about the terms of your mortgage.
Ask your broker about the interest rates, the amortization period and other important information before agreeing to the terms. You also need to find the date till which the rates are valid to ascertain how much time you have to decide.