A self certification mortgage is one where the lender does not ask for proof of income and is suitable for self employed, company directors, commission based workers and those who have more than one source of income either from investments or more than two jobs.

Self certification mortgages used to be only for the self employed and because of the perceived increased risk the rates and deposits were subsequently higher. However these criteria have changed and self certification mortgage are now available to employed as well as self employed people and the rates are similar if not better than prime rates. This has come about because more and more lenders have recognised that employment patterns have changed and people are not able to produce wage slips or P60 forms, which will justify a mortgage. A 10% or 15% deposit is still required.

Different lenders have different criteria some will contact your employer to ensure that you are employed or contact your accountant to ensure that you have been self employed for 3 or 6 months, but in neither case will salaries or drawings be discussed. Some lenders will take the applicants word and not bother contacting anyone.

Even people with bad credit records can apply to an adverse lender for a self certification mortgage. Although the lender does not verify income it is up to the broker to satisfy him or herself that the income the applicant is disclosing is realistic.