Buying property can be rather difficult for people with no fixed income, or a without long history of steady employment. Many self employed or business people work hard and do quite well for themselves, despite an irregular income. They can prove how successful they are, yet many mainstream banks still will not consider them for self employed home loans. Even if a bank will accept a mortgage application, the process will be long and strenuous. Self employed home loans are simply harder to obtain.

While traditional banks frown upon self employed loans, some financial institutions will give business people and contract workers a chance to realize their dream to buy their own home. They understand how the income system of self employed works and will take that into account when reviewing an application. They will consider all the different loan requirements and not simply a few monthly income statements. Nonetheless, if you are a member of the self employed workforce and would like to apply for one of the self employed home loans some mortgage lenders have to offer, the following guidelines may come in quite handy.

1. Ask a bank counsellor exactly what you need to do. Familiar with all the applications, the bank representative can explain in detail which forms and documentation you need, as well as which loan types would be best suitable for your needs. Working closely together with a real bank employee is the best way to get the process started – the right way.
2. Start organizing your paperwork. Locate your income tax return records for at least the past two years, and accumulate several months worth of business related and personal bank statements. The bank will require your personal information to ensure that you are not overspending and are handling your income sensibly. They may also want to know if you are reinvesting some of your funds into your business so your success will continue. When you hand in your application, also include a copy of your business license, and proof of identity. Your bank counsellor will give you an exact rundown of the documents you will need.
3. When applying for self employed home loans, your mortgage lender can also ask to see cancelled rent checks, or proof of house payments. You will have to prove that you are paying your bills regularly and on time. They may also request other documents so they will know that you indeed have an excellent credit history.
4. The days of a simple handshake to close a deal are long gone. You will have to prove your income with proper documentation. All of your paperwork has to be verifiable; the older statements as well as your current income.
5. Always keep in touch with the self employed home loans department. Furnish them with everything they demand, as soon as you can. Do not put off these chores as it may give them the wrong impression. Also, be clear about your own wishes so there will be no confusion. Having to change, for instance, the term of the mortgage from 15 to 10 years will cause frustration and delays. Deferrals can also cause you to lose your chance to buy your dream home. By the time you have your affairs in order, someone else may have already snatched up the property. Therefore, always be quick, honest and to the point!