The loans, which are a vital source of funding for self-employed people or anyone with an irregular income or income from various sources, have all but dried up leaving the self-employed struggling for mortgages.
Just 2% of all fixed rate deals available are self-certification mortgages and variable deals have now been completely withdrawn. This equates to a tiny number of products with just 22 fixed rate deals available.
Twelve months ago self-certification mortgages accounted for 6% of all fixed rate deals and 14% of variable deals. Borrowers were able to choose between 55 fixed and 105 variable products.
And going back further to December 2007 - before the credit crunch took its full toll - self-certification mortgages accounted for almost 17% of the mortgage market and borrowers could choose between 247 fixed rate products and 134 variable deals.
Julie Speed, national accounts director at Evaluate Technologies said: “The plight of the first-time buyer has been well highlighted but the self-employed have been equal victims of the shrinking mortgage market. Lenders have sought to de-risk their mortgage offering and anyone whose income is difficult to prove is by definition a higher risk customer.
“Honest, hard working self-employed people have few options to choose from and brokers face a stiff challenge finding suitable products for the self-employed.”
Lenders currently offering fixed rate self-certification mortgages currently include Woolwich, Standard Life, BM Solutions, Platform and The Mortgage Works.
