HELP! I’m self-employed

There has been a rapid rise in self employment over recent years, in fact the number of self employed workers has increased from 3.3 million in 2001 to 4.8 million in 2017, according to the Office for National Statistics. They now account for a substantial 15% of the British work force. 

But amongst those who are self-employed, there is a common belief that being your own boss can hinder your chances of getting a mortgage. According to research by Aldermore almost a third of self-employed homeowners believe the mortgage process is biased against them.

Does the way I take my earnings mean I can’t get a mortgage? Will lenders treat me differently? These are questions you may often find yourself asking if you’re your own boss. A good mortgage broker will be able to help answer all of your questions, but let’s start by debunking a common myth…

Myth busting
Self-employed mortgages do not have their own mortgage category. If you’re your own boss you are able to access the same products and the same rates as everyone else providing you meet the correct criteria. Great! But the problem is that your earnings are more complex and you must be able to prove them.

Ultimately, when applying for a mortgage, you will be assessed on how much you are earning, how likely is it you will sustain that level of earnings, how you take your earnings, how long you’ve been trading for, your accounts history and a number of other things. Then the lender will make a judgement – so you can appreciate how complicated and slow the application process can be.

So, should I use a broker?
Overall the application process can be a lengthy, complicated and time-consuming process which is why seeking advice from a mortgage broker can be so valuable.

Because calculating income and eligibility has so many variables, for self employed workers it’s important you ensure you apply with a lender that most favourably views your circumstances. So, whether you have many years’ experience of being your own boss or just a short amount of time – seeking professional advice through a broker can make the whole process easier and more beneficial.

A mortgage broker will be able to point you in the direction of a lender that is not only willing to lend but also those most likely to provide you with the best deal all while saving you the time and hassle.

Life Cover when living with a serious medical condition

There are around 66 million people living in the UK and we Brits are largely underprepared in case the worst should happen. Many of us may have been, or could in the future be diagnosed with a serious medical condition and we all have unique circumstances that mean we need different types of cover.

Amongst those of us who have been diagnosed with a serious medical condition there is a common belief that we are unable to get protection. Because of this it’s not so surprising to hear that only 15 million adults have a life insurance policy in case the worst were to happen, according to Legal and General.

To put it into perspective, one in two of us will develop some form of cancer at some point in our lifetime according to Cancer Research UK, and around 27% of people within England alone are claimed to be obese, according to the latest Health Survey for England Report.

A report by the Exeter has found that two thirds of cancer sufferers do not have a single protection product in place. The ‘An Unhealthy Situation’ report, which surveyed 2,000 people across the UK, also found a similar situation for people with type 2 diabetes, those with high BMI and those with heart conditions.

With these conditions it’s arguably even more important to ensure you’re protected for your unique circumstances. It can provide you with peace of mind as well as financial stability for your family.

With this in mind, more providers, like the Exeter, are making protection more accessible to everyone, even if you have a serious medical condition. In some cases, insurers will be able to cover people living with medical conditions such as:

  • Cancer
  • Type 1 diabetes
  • A BMI above 48
  • Complex heart conditions
  • Multiple conditions

The Exeter’s ‘Real Life’ product is a specialist life cover product for we Brits with complex medical histories and disclosures. It gives many of us access to valuable protection that we may not have previously been able to access.

There are a range of serious medical conditions that we can all develop in our lifetime and with the diagnosis of conditions like diabetes and cancer on the rise, it is incredibly important to make sure we’re suitably protected for our own individual needs. This is why seeking expert advice is invaluable.

So, if you’re living with a serious medical condition and want to find out what level of cover is available to you, contact one of our advisers today.

Stamp duty: How much will you pay?

Stamp duty. Two words that strike fear into the minds of every home buyer. But do you really know how it’s calculated and ultimately how much you’ll pay?

One of former Chancellor George Osborne’s most popular moves was the abolition of the ‘slab’ system of stamp duty land tax. Prior to the change in 2014 buyers paid stamp duty based on the price of the property, but it was applied to the whole value of the home.

This meant that if your property was just £1 above one of the thresholds you’d have to pay far greater levels of stamp duty compared with a house that was £1 cheaper and just below the threshold. But now home buyers pay a graduated rate so that the higher rates only apply to the amount over each threshold. Much better!

In England and Northern Ireland stamp duty is more commonly known as Stamp Duty Land Tax, In Wales it is referred to as Land Transaction Tax and in Scotland it is known as Land and Buildings Transaction Tax. Depending on the country in which you are purchasing a property, different rules and tax calculations will be applied.

England and Northern Ireland
Based on a traditional residential mortgage for the average English property value of £243,639, according to the latest UK House Price Index, your total for stamp duty would be £2,372.

Based on a traditional residential mortgage for the average Scottish property value of £148,952, according to the latest UK House Price Index, your total for stamp duty would be £79.

Based on a traditional residential mortgage for the average Welsh property value of £156,495, according to the latest UK House Price Index, your total for stamp duty would be £0.

However, if you’re a first-time buyer in England and Northern Ireland purchasing a home for £300,000 or less you’ll be exempt from stamp duty altogether. You’ll be charged 5% on anything over £300,000 up to £500,000 – anything over £500,000 and you won’t be entitled to discounted rates. These discounted rates also don’t apply for first-time buyers in Wales whereas first-time buyers in Scotland are exempt up to £175,000.

Also, different stamp duty thresholds and different tax rules and calculations will apply to second properties, buy-to-let properties and other factors like whether it’s shared ownership.

If you want to calculate how much stamp duty you’d have to pay depending on your circumstances, use this handy tool for free!

If you’d like more information or to discuss your buying options contact one of our advisers today.