There have been a lot of changes in the financial world since the beginning of the economic downfall, an area that has greatly changed is mortgages. Today more and more lenders are placing restrictions and limitations on the type of individuals who require a mortgage; in fact many people are unable to obtain a mortgage due to their employment or credit history.

One of the biggest changes to the mortgage market is the elimination of self cert mortgages. The new regulations created by the FSA state that only borrowers who can afford to repay a mortgage should be allowed to obtain one, essentially this has meant a large number of lenders no longer offer self cert mortgages.

Self cert mortgages, also known as self employed mortgages, were a unique type of mortgage offered by UK lenders. The process for self cert mortgages was dramatically different to normal mortgage application.

A normal mortgage application required evidence of your annual income, this however was a problem for many individuals seeking a mortgage who were self employed. Self employed individuals traditionally were able to obtain a mortgage, however, they had to provide accounts for three years of their business; this proved difficult for newly self employed people.

The strict rules and growing number of self employed people in the late 1980′s lead many lenders to re-evaluate the self cert mortgage. The new self cert mortgage worked on a trust basis with many only having to provide some evidence of their earnings as well as the twenty percent deposit. Essentially you were able to self certify yourself for a mortgage, without providing obligatory financial information.

Today self cert mortgages are no longer provided, however, there are a number of mortgage options available to the self employed. The most popular option is a contractor mortgage, although this offers some drawbacks, including increased interest rates, it does guarantee that if you are self employed you will be able to acquire a home mortgage.