Self Cert Mortgages in the current climate

BenL

Hi

I do not have house or mortgage at the moment but I was thinking earlier today about people who took out self cert mortgages within the last couple of years - especially the last year with the current HPI for then being so low.

Did/do the self cert mortgages have operate like a standard mortgage just that people did not have to prove their income?

Are these still available?

Are additional checks now done?

If they operated like a standard 2 yr fixed for instance is this another blow coming when its remortgage time?

Working on the multiple system and new LTV that appearing will surely rule out a lot of people who (lied to) have a self cert mortgage.

When I did have a house I avoided the self cert and got a standard Nationwide mortgage then a A&L one for the next house.

Quite a few people I knew from school (I am 27 now so within the last few years) either did a NR 100% or more, or a self cert to get a house.

I however sold my car, paid off loans and had some savings so could do 90% LTV on the 1st and 80% on the 2nd.

The massive reduction in mortgages availble will force these self cert people to be stuck on high rates now the plan they may have been banking on with HPI to pull up their wealth.

Anyone on here with a self cert coming to an end or know someone?

Physio

Hi Mate,

we have a high self cert and our fixed rate ends in July we are also wondering what will happen. We have always paid our mortgage but we are conserned, though we were luck to pay off £35,000 this year so our mortgage repayments wont jump considerably due to this but I feel there may be problems for the less fortunate.

I dont want to go through the process of self cert again, very stressful then God knows how stressful it will be now, so we will have to see what is avaliable with our current lender,

regards,


Physio

BenL

Thats good for you that you paid off such a chunk this year.

That should hopefully get you a good product deal.

So a self cert operates like a standard mortgage with most likely people starting off on a fixed rate.

I just hadn't heard/read anythign about customers with these coming to the end but I guess they have just been lumped in with the talk about fixed rate periods coming to and end in general.

Dan_Collins_2

Self cert is just about still here. At 90% LTV you are very limited and rates reflect that.

If you have 85% LTV or lower you have a bit more choice, below 80% or even 75% you have much much more choice.

Lenders are checking a little more, however they are still offering true self cert. They will tend to seek proof of self employment. Whats the point of asking a self cert client for proof of income? They would more than likely just declineit if they did not like it.

I would be a little worried if you took out a self cert at 90-95% over the last year or so! More so if it was a new build!

FraudBuster

Self-cert lesson #1.

Do not LIE on application forms.

luckyfool

People who took out a Self Cert mortgage for genuine reasons should not generally be in such bad shape. Normally this will have been as they were newly self employed and while their first mortgage was self certification, they would be able to move onto a full status standard mortgage when their deal comes round(as they should be able to satisfactorily prove income by then).

I have limited sympathy for people who committed mortgage fraud and got a self cert mortgage so that they could lie about their income.

FraudBuster

Dear Mr/s Judge,

Please help stop my repo.

I know that I lied, but everybody else was doing it.

Dan_Collins_2

Very true Luckyfool. I have a client who cant prove his income and he has been in business for 15 years, long story but he will never miss a payment. I have turned away a lot of business this last 6 months, people have just openly said they need self cert because I dont earn enough. One of the guys in the office, had one that was really pushing it, the broker told him to go away and think about what he was doing, but he still got a mortgage and brought a property via one of the brokers EA's. Obioulsy the guy I work with looked like a tit, the EA did not give a monkeys and took the offer. I dont doubt when his deal ends he will be up the creek without a paddle!

taxi73

I was self cert on my first and second mortgage due to not having 3 years books and have just remortgaged again on a fast track with Abbey and none of it was lies and I now have 50% equity in my house so am no risk to them anyway.
I think it will be bad for those that have self cert because they didn't really have the income to buy the house in the first place and doubled with a price drop it will come back to bite them on the backside...

luckyfool

Dan_Collins wrote: »

Very true Luckyfool. I have a client who cant prove his income and he has been in business for 15 years, long story but he will never miss a payment. I have turned away a lot of business this last 6 months, people have just openly said they need self cert because I dont earn enough. One of the guys in the office, had one that was really pushing it, the broker told him to go away and think about what he was doing, but he still got a mortgage and brought a property via one of the brokers EA's. Obioulsy the guy I work with looked like a tit, the EA did not give a monkeys and took the offer. I dont doubt when his deal ends he will be up the creek without a paddle!

I had one enquiry where they were asking for self certification, though it wasn't clear to me why they would need it. When I explained that they could not get a self certification loan for the loan to value or terms they wanted she passed me onto her husband who asked me to look at full status mortgages for them, as he could get "payslips" that would say whatever they needed to say.

Needless to say they went elsewhere for their mortgage advice.

Dan_Collins_2

Yep, it is worrying, also brokers out there will offer payslips, account and all sorts!