More and more people are turning to self-employment to combat the changing economy and beat the redundancy trend. As a result, local businesses and cottage industries are drastically increasing. While this offers a lot of great benefits, such as flexible working hours, freedom from bosses, and an ability to set your own rates and choose your own projects, it also has its downsides. Typically, freelancing and self-employment are not areas with a lot of stability, and lenders therefore tend to avoid clients who don’t have steady employment.
Not only can this avoidance have an implication on your finances, but if you’re self-employed and wish to purchase your own home, you might not be able to get a mortgage. This is especially true if you’re new to your business: even if you’re making good money, you won’t have had time to build up a strong tax history or have year-on-year accounts to prove your income. Even if you do it can be tricky, so you may have been put off even trying to go for your own home. If that’s the case then this information could prove valuable:
How to get your foot on the housing ladder when you’re self-employed
Being self-employed doesn’t mean that you’ll never be able to get a mortgage, in fact, there are plenty of ways you can try. If you visit the Homestart website, you’ll find advice on one of these ways: Homestart loans. These loans are designed to help people purchase their first home, even if they’ve been excluded from the traditional mortgage market. You don’t need to find a large deposit up front either, as Homestart loans accept a minimum of 5% to qualify. Looking to build from scratch? Whether you’re buying land now for later or embarking down the self-build route right away, you can get started with just 8% laid down, thanks to the home loans.
Home loans that are far more flexible
There are a variety of reasons to look further into whether you’re able to get a home loan. Flexibility is a key feature, as with some home loans you can make voluntary repayments, redraw against those payments and even take payment holidays when you need to if you go for some providers. You will also benefit from a locked-in rate that helps you avoid interest rises: a big problem with some mortgages.
Your home loan might work out cheaper than a traditional mortgage, too. With a Loan Provision Charge replacing the Lenders’ Mortgage Insurance fees, costs are lowered on most deals, and you should find yourself with more money to put into making your home your own. Down the line, you might need to release some cash to make repairs or renovations to your home. Some home loans give you the flexibility to do this.
When you want to get into your first property but you’re facing the challenge of unrecognised and unsupported self-employment, there is help out there for you. Look into taking out a home loan to replace the usual mortgage, and you could find yourself owning your own home much sooner than you think. If you’ve created a business from scratch and proved yourself successful, you could get the home you deserve to match the career you’ve built. Just because some routes seem blocked, don’t give up – you could soon be picking up the keys to your very own house.
