I want to self certificate - has this got harder due to credit crunch?

toonfish

The Mortgage Works only require you to declare your monthly disposable income, so there is no need to produce fantasy income as long as you can afford the loan

HairyHandofDartmoor

Thanks toonfish, that is useful to know.

HairyHandofDartmoor

I forgot to mention that we get £2028 per year in child benefit, which I did not include in our income of £30,000.

herbiesjp

With that kind of deposit, and that kind of income you may not need to self cert

There are some lenders that can be more flexible, if the broker takes the time to discuss verbally beforehand with the lender.

So potentially there are several lenders that could look at this for you at standard high street rates, as opposed to self cert rates

HairyHandofDartmoor

Thanks, herbiesjp. I hoped this might be the case.

I don't feel we are typical, so a flexible lender who would be prepared to look at our individual circumstances is what we need.

Dan_Collins_2

toonfish wrote: »

The Mortgage Works only require you to declare your monthly disposable income, so there is no need to produce fantasy income as long as you can afford the loan

Took the words fomr my mouth, nice post mate!

AndrewSmith

Dan_Collins wrote: »

Just read your post again! Self cert means self cert. Right or wrong if you self cert using a lender that wants banks states then you will walk in to trouble. There are plenty of lenders that offer a true self cert mortgage and when used correctly they are not as bad as what ppl make out.

With respect, having been in the industry for a long time now, and being somewhat of a specialist in self cert, let me share this with you.

Lenders use bank statements to asses more than just income, however if income is overstated then it will show on the statements. Common sense.

Also, you may only declare income that is able to be included on your annual tax return or declared as income to the inland revenue unless it is unearned income such as from tax free investments etc.

If a client tells an adviser that 'I earn extramoney on the side for cash and do not declare it' then this income cannot be used for mortgage purposes even under self cert. Ask your compliance officer, he will confirm that.

The compliance stance on this is that if you include income that you know a client is not declaring to the revenue for tax purposes then you are assisting and condoning tax evasion.

Self cert means self cert yes, I agree. However self cert merely means that you cannot evidence your income by the normal means of Audited Accounts or Regular Salary Payslips. That's all, nothing else. The lender reserves the right to ask for any evidence it sees fit and sometimes they will.

If you are not overstating or lying about income then why are you walking into trouble if the lender asks for bank statements? Are you openly admitting in a public forum that your understading of self cert is that you can put a false income figure or include non declared earnings?

inmypocketnottheirs

I guess the OP is receiving income by way of shareholder dividends from a ltd company, thus paying 19% corporation tax, rather than through PAYE at 22/25/40% plus NI. That is why self certs are appropriate, in such an instance where the income is received through non PAYE sources.

AndrewSmith

Not disputing that and dividend income still has to be declared on the Annual Self assesment, thus it can legitimately be included for self certify. It would also be clearly evident that this was the case by bank statements as well however, thus self certify may not be the most appropriate route to go as the income via the Self Assesment return and bank statements can be evidenced, and given the relatively large deposit it may be seen as a good risk to a number of mainstream lenders.

Self Certify has been somewhat over used and over promoted of late by lazy brokers/advisers who cannot simply be bothered or do not have the depth of knowledge or experience to know how to deal with a case properly.

HairyHandofDartmoor

The last three posts have lost me a bit I'm afraid I don't have any income other than that already mentioned.

Based on the replies on this thread, self certification may not be the best route for me. I was merely looking for flexibility. The best route may be to find a lender who will be willing to lend a multiple of 5 times our income.

When we are closer to wanting to move, I will use a broker to find out whether this option would be at all possible. A lot could change in a year!

Thanks for all your replies, everyone.:D