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Finding solutions for your self-employed clients
By Liza Campion, Head of Corporate Accounts, Precise Mortgages
There are obvious benefits to being self-employed – the freedom of choosing which jobs to accept and the flexibility of setting your own schedule being two key reasons. But in today’s climate, the struggles that self-employed workers face can seem to outweigh the advantages of working for yourself.
As a broker, providing the best advice is at the core of what you do. So understanding the nuances of criteria from different lenders helps you bring alive the options available for your customers, providing them with an appropriate solution for their investment goals.
Now, whilst I’m not suggesting for one second that every self-employed individual in the UK will need your assistance, I’m keen to highlight that it’s important to understand the self-employed market and the lenders that can support you and your customers.
Because when these cases do crop up, you want to be the broker with the answers.
However, it’s important to remember that self-employed customers may reach out to you for more than just a straightforward residential mortgage or remortgage. There could be many other reasons.
“Self-employed trend insight shows 32% of individuals invest within their pensions, and a huge 46% use their income for property, including buy to let investments1.“
Your customers know that you’re their best chance of them being approved for a loan, so it’s important you’re aware of the different scenarios that you could come across, and which lenders to turn to for support.
How we can help your self-employed clients in 2021
Affordability is a concern that many self-employed individuals face, with them hoping that lenders can support them wherever possible, or provide an appropriate solution.
Let’s take Precise Mortgages as an example of a lender that could help, as they provide the option to factor in regular pension contributions and car allowance for affordability purposes.
Here’s an example:
A self-employed customer approaches you and gives the following breakdown of their income:
- Salary – £10,000
- Dividends – £40,000
- Car allowance – £10,000
- Regular pension contributions – £10,000
Based on the above, Precise Mortgages would be able to consider the full £70,000 for affordability, subject to criteria of course.
So when you’re looking at your customer’s accounts, it’s always worth checking what allowances and contributions they’re making – it could be the difference in them getting the loan they need.
Solutions for self-employed buy to let customers
Bearing this in mind, let’s imagine a self-employed customer approaches you to discuss a potential buy to let investment. They raise concerns with you that they feel that their age may be a barrier to them securing the borrowing and term that they need.
“The truth, roughly 10% of the self-employed are aged 65 and above, compared to 3% for regular employees2.“
However, because you’re well versed with specialist lending criteria, you’re able to highlight that lenders such as Precise Mortgages are able to lend to a maximum age of 80 at the time of application, with the option of up to a 35-year term. This could provide your self-employed customer with exactly what they need.
Would you like to see how we could help?
Combining our products, criteria and five star service, we’re committed to supporting self-employed customers and those who have felt underserved by high street lenders.
Even if you have a customer that’s taken advantage of one of the many government bounce-back schemes, or one needing to work from a true one year’s trading, or financial year end figures, our products and criteria help you to provide options for even the most demanding self-employed cases.
If there’s anything highlighted in this article that you would like to discuss further, please speak to our award winning sales team today, who will able to provide more information and talk through the options that we have available at Precise Mortgages.