I’ve had a self-cert mortgage before. Is it true they’re banned?
Granted, self-cert mortgages were the most common way that those on a non-permanent contract secured finance to pay for their homes. However, they were NEVER the best way.
In our opinion, getting rid of self-cert has done contractors a favour. For anyone used to funding their home purchase this way, it probably doesn’t seem like it at the minute.
High Street lenders have an out of date bias towards permies. Their advisers can work out neat little sums and pigeonhole full-time employees into specific categories.
This doesn’t work for those who receive irregular pay. In the past, because advisers weren’t altogether sure how contracting worked, self-cert seemed the only product that fit the bill.
Contractors were just happy they’d been accepted. Advisers were happy that they’d been able to help. Or that they’d made a commission, depending on how cynical your outlook.
However, as self-certification was open to people concocting their own affordability, they were a greater risk to lenders. As such, interest rates were often higher.
Following the 2008 banking collapse, responsible lending ensued. Due to how heavily-gamed self-certs had been prior to the collapse, the product was withdrawn from lenders’ portfolios upon the insistence of the now re-categorised FSA.
The irony is, with contract-based underwriting, contractors never needed self-cert anyway. The mortgage products we offer today are as competitive as those offered to permanently employed people and are perhaps more accessible!
Whether you choose our mortgage service or not, avoid advisers and High Street lenders who aren’t prepared to assess you on your annualised contract rate. And don’t ask for a self-cert mortgage, as they simply no longer exist.