Speaking at the Network Data annual conference, Martin Reynolds, head of sales at BM Solutions, admitted the self-cert sector had undergone vast changes over the past few years and said brokers needed to be advised on the benefits of the growing sector.
However, he stated the need to distinguish between self-cert and fast-track. “Self-cert is not a cascade from mainstream and it is not fast-track. Equally, it is not designed for people to lie about their income. Fast-track is different to self-cert, and borrowers should be aware of this,” he said.
He added that the self-cert market was overcoming the myths and confusion that had surrounded it. “The sector is still growing and it is estimated that 8 per cent of the market in 2006 will be through self-cert. More people are becoming self-employed, and the gap between mainstream and self-cert rates are edging closer together.”
“There is a greater reliance on bonus and commission now, from the city trader to the car salesman and with a fractured income stream people will have a surplus income, which will lead to increased self-cert business,” he explained.
Peter O’Donovan, mortgage manager at Bestinvest agreed self-cert and fast-track products had their similarities, but fundamental differences separated the two. “With fast-track it is usually used on cases with a lower LTV that can be pushed through, and it is usually a case of being able to have the right to examine income if needed, whereas with self-cert it is the clients statements. Brokers or lenders may phone the clients accountants to check to see if they are trading, but the two product ranges are different things,” he said.
