If you own a limited
company then you may be wondering where you stand when
you are looking for a mortgage. Many people set up
limited companies for tax and investment reasons and so
they prefer to take out buy to let mortgages. If you do
not wish to do this then you will have to do quite a lot
of research to find a mortgage lender who will give you
a mortgage.
Why Limited Companies Struggle to Get a Mortgage
Whilst it may be a
better option to set up a limited company rather than
being a sole trader for tax purposes, you will still
find it hard to show prove your income every single
month. This means that mortgage lenders still look at
you less favorably than they would if you were employed
by somebody else and that could present you with
problems when applying for a mortgage.
However there are a
number of options open to you and one of those options
is a self cert mortgage.
What is a Self Cert Mortgage?
A self cert mortgage
is ideal for the self employed because it does not need
payslips to certify your earnings. You will not have to
give the mortgage lender any documentation and they are
designed especially for people who are self employed,
though people who are employed can also apply. You can
get the following types of self cert mortgages:
- Fixed Rate
- Variable Rate
- Flexible
- Capped
Different lenders will
offer you different options, so it is always a good
choice to look around. See what the best interest rates
are and compare at least five different companies.
Overall self cert mortgages are just one option open to
you if you do own a limited company. Always shop around
to find the best offers and do not expect to get a
mortgage if you have only been running your limited
company for a small length of time.
