As a self-employed person, you enjoy freedom and flexibility, but when it comes to buying a house, it can sometimes seem as if doors remain closed. Nothing could be further from the truth! Huiskamer Hypotheken understands the unique situation of self-employed people and is happy to help you realise your dream home. Let's take a closer look at the mortgage options for self-employed people.
The Challenge: Fluctuating Income
The biggest hurdle for many self-employed professionals is the fluctuating income. Whereas an employee with a permanent contract can present a stable payslip, the income of a self-employed person often varies from month to month or quarter to quarter. As a result, banks traditionally take a different view of their borrowing capacity. Fortunately, more and more mortgage lenders are responding to this.
How is your income assessed?
To calculate your maximum mortgage, mortgage lenders look at your average income over the past three years. This means that you must be able to submit your company's annual figures (profit and loss account). Some lenders are already more flexible and, in specific cases, will even accept two or even one year's figures, provided you can demonstrate that your income is stable or shows an upward trend. This applies, for example, to professions with a proven stable income, such as many medical specialists.
Important Points to Note
- Number of years active as a self-employed person: Most lenders require you to have been registered as a self-employed person with the Chamber of Commerce for at least 12 months. The longer you have been active, the more stable your situation is often considered to be.
- Profitability: It is essential that your business is profitable. You cannot operate at a loss on a structural basis.
- Future prospects: A mortgage adviser will also look at your industry, your order book and your general prospects. A well-founded business plan can help with this.
- Own contribution: Although not mandatory, having your own savings or equity in a previous home can significantly strengthen your position.
What types of mortgages are available?
The types of mortgages available to self-employed persons are essentially the same as those available to salaried employees. These include:
- Annuity mortgage: You pay a fixed amount of interest and repayment each month. In the beginning, you pay a lot of interest and little repayment, later this is the other way around.
- Fixed-rate mortgage: You pay a fixed monthly repayment amount, plus interest on the remaining principal. Your monthly payments decrease over the term of the loan.
- Other types of mortgages: subject to certain conditions, other types of mortgage are also possible (for example, if an existing mortgage was taken out before 31 December 2012).
Tips for self-employed professionals looking for a mortgage
- Keep your records in order: This is crucial! Ensure that your annual figures are clear and accurate. A good accountant can be indispensable in this regard.
- Build up reserves: A financial buffer not only provides peace of mind, but can also come in handy when applying for a mortgage.
- Seek sound advice: A specialist mortgage adviser, such as those at Huiskamer Hypotheken, knows their way around the complex landscape of mortgages for self-employed professionals. We know exactly which lenders offer the best terms and how we can present your situation in the best possible light.
- Be realistic: It is important to have a realistic view of your financial possibilities. Consider a mortgage that suits your current and future income situation.
Huiskamer Mortgages: Your mortgage advisor
At Huiskamer Hypotheken, we believe that everyone, including self-employed entrepreneurs, should have the opportunity to buy their own home. We take the time to understand your specific situation and find the mortgage solution that suits you perfectly. No standard approach, but personal advice tailored to your entrepreneurship.
Are you self-employed and dreaming of having your own place? Then take feel free to contact us. We would be delighted to discuss your options and assist you in finding your dream home.