What is a Self Certification Mortgage ?
Self certification mortgages are normally for people with a large amount of money for a deposit but no way to prove a reliable income and it allows the deposit to speak in place of their payslips as to how much money they make, thus they can self certify that they have enough income to pay off the mortgages hence self certification mortgages. More and more lenders these days are allowing self certification mortgages mainly for people who are self employed and therefore cannot provide a clear series of payslips for a long period of time which the banks require for people with less deposit to prove that you can afford to pay off the mortgage term.
This is quite useful to self employed people or people who get paid through a dummy company for tax cutting purposes since the actual amount they have access to differs substantially from the amount they pay themselves in wages so on paper they are paupers where in reality they have a company that is earning their money and paying all their expenses and then only paying them what they want the taxman to see them getting.
Self certification mortgages are also quite good for people just starting out in a new career with good steady income and a fair amount of deposit behind them. Its true they might not be able to produce 3 years worth of payslips on demand but due to their change in circumstances they wish to get a mortgage started and over with fast.