Cheap Rate Self Cert Mortgages

Author: admin, June 26th, 2011

Self cert mortgages emerged during the 1980′s housing boom. These mortgages are a way for people will multiple income sources to prove they can afford a house. Typically, when people go to buy a house, the bank requires a steep down-payment in addition to several legal documents proving the person’s income. In some lines of work, proving income can be an extremely difficult task. Self cert mortgages can provide a relatively cheap rate, especially considering the lender is basically blind and is simply trusting that the borrower can actually afford the home.

Several places offer rates initial rates for as low as 1.99%, with an annual percentage rate of 2.9%. Here is what this would look like in an actual mortgage scenario. The low self cert mortgages are used on a 150,000.00 with the 1.99% initial rate, 2.9% annual percentage rate, deposit, loan to value. The individual would end up paying 9,556 for the fees and interests. These self cert mortgages are not bad at all, considering the person paid a little under 10% in interest on a 25 year mortgage. The even better news is that they did not have to show any proof of income. This is a scenario for someone who has previously purchased a home.

This is what typical self cert mortgages look like for someone who is a first time buyer. It was a trick, the self cert mortgages offer the same low interest rates for first time buyers as well. That is exactly the point being made, no matter who the buyer is, assuming the bank trusts they cannot show proof of income they can get a mortgage for as cheap as anyone. Many banks offer self cert mortgages and it is easy to shop around for the best rates. It may come down to which bank actually accepts the loan or which one can process it the quickest, but the cheap rates are definitely out there for those who would otherwise be unable to purchase a home.

Categories: Self-Cert Mortgages | No comments

The Self Cert Mortgage

Author: admin, May 29th, 2011

The purpose of the self cert mortgage is to provide a mortgage for a borrower when their income does not fit the general qualifying guidelines. The self cert mortgages are the result of the financial boom of the 1980′s. At that time many were self employed, they needed mortgages but were not able to prove their income. Self cert mortgages are a high risk mortgage so be prepared to put at least 25% down on the property you purchase. It is best to use a mortgage broker to help you locate a lender that can provide self cert mortgages. The larger the down payment the greater the selection of lenders the broker will be able to offer for your self cert mortgage. The interest rate on the self cert mortgages is higher than a typical mortgage. The rates are higher on the self cert mortgage as the risk for the lender is much higher on the self cert mortgage.

To apply for the self cert mortgage a borrower simply declares their income. This type of mortgage is very beneficial to someone that is self employed. An individual that has seasonal employment, or the owner or a small business may benefit from the self cert mortgages. Sales people that commonly work on commission my also benefit by using the self cert mortgage. Anyone who has difficulty documenting their income can benefit from the self cert mortgage.

The borrower for a self cert mortgage must prove their credit history is a great credit history. Although proof of income is not required they must show that they have in the past had income and can handle their obligations. The self cert mortgage is not always the best option for a mortgage, however for the self employed that cannot prove their income this may be the only mortgage option. Currently the FSA, (Financial Services Administration) regulates the self cert mortgages.

Categories: Self-Cert Mortgages | No comments