Self Certification Mortgages, what are they ? Page 2

Self certified mortgages allow borrowers to take as much as £1 million with a 10 - 15% of deposits

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What are the most common optional extras available on life insurance policies?: When considering the purchase of a life insurance policy you are almost certainly going to be offered additional extras that maybe added to the plan. The following three are the most common: -
What is Term Life Insurance?: Term Life Insurance is a category of insurance that will payout a lump sum to you or your family if you die or fall terminally ill during the term of the policy.
How does my age affect my life insurance premium?: Age is one of the most influencing variables that affect the premium for any given form of life insurance policy.
Will my life insurance premiums increase over time?: The answer to this question depends upon whether you have a normal “Guaranteed” policy, a “Guaranteed indexed linked policy” or a “Reviewable” policy.

(this is dependent on the lenders). Self certified mortgage carries a higher rate of interest than most of the regular mortgages because of the increased risk.

The amount of money that a customer can borrow on self certified mortgages is calculated after adding up the annual income of both customer and his/ her spouse (if both are working), along with any bonus, commission, and any other sources of income pertaining to the customer.

Customers shall after making the calculations decide how much can they pay as the monthly installment. They have to be careful in deciding this. They know their monthly income better than any other person. Both extraordinarily high income and an unusually low income ( life insurance ) as the basis for deciding the monthly payment can result into problems. In the former case, the borrower is stuck up in the payment. In the latter, the mortgage takes more time to be repaid. An average income, trimming off the fluctuations, will be the optimum payment.

Customers can have as many choices through the self certified mortgages as they could have on the regular mortgages. They can have a flexible mortgage wherein they can pay more in the months when his earnings are increasing. In the months of depression he can pay less or take a payment holiday. Similarly the self certified mortgages come with the features of tracker rates, fixed rates, capped rates and many other interest alternatives.

But the process of self certified mortgages differs with lenders. Some lenders may conduct special enquiries as to the credibility of the customer. Normally banks may be contacted and accountant details checked. As discussed earlier about the legality of the purpose, lenders may ask for proofs if they have any doubts.

It is recommended to take professional advice regarding the suitability of self certified mortgages for your income. The customers must choose the mortgage provider properly. Choose ( life assurance ) the one who charges the best of rates. Before signing on any document examine the various clauses properly. It may have included hefty redemption charges, for instance, to check the customers from shifting over to a regular mortgage.