Housing Finance benefit
for self-employed individuals is a scheme given to people, who have low income
and could not afford to buy a house. This benefit gives a chance to lie in adecent place without restraining the budget.
As
long as you have the necessary requirements, you can apply for a housingbenefit.
Applying
for a Housing Benefit, if you want to live in a decent accommodation, yet you
do not have enough funds to obtains a fully furnished house and then you should
apply for a housing benefit. This is not only for employed individual but also
for self-employed. All you have to do is inquire from the concerned Agency, if
you are qualified for such a benefit. When you apply for housing benefit, you
should possess any of the following, such as income support, having a full timeor part time job as well as self-employed.
On
the other hand, there are several factors that affect the awarding of the
housing benefit to a self-employed individual.
- The amount of rent that can be afforded by the applicant;
- Council tax liability;
- Number of family members, including the non-dependants.
If you know that you are
qualified for housing benefit, you should not delay claiming it. The firstthing to do is to proceed to the agency and complete the claim form. As much as
possible, you should show proof of self-employment, proof of income and other
requirements asked by the Office. If the claimant is self-employed, there are
other requirements to be submitted before the claim is processed.
Moreover, when applying
for housing benefits for self-employed, you should ensure to meet the savings
required. Likewise, the approval of the claim is based on the savings as well
as personal circumstances of the claimant. It is also required to submit the
audited business accounts and the self-employed earnings. On the other hand, if
the Applicant does not have the audited accounts, self employed individuals
have created the need for a special category of mortgage loans for self-employed Borrowers. While loans for the self-employed have been around for
many years, recent streamlining of some programs makes the process simpler and
safer for self-employed Borrowers. Despite the recent tightening of mortgage
underwriting overall, the self-employed can still get mortgage loans. The
primary problem that self-employed Borrowers face is that while their
accountants are experts at reducing tax liabilities by minimizing current net
income, underwriters rely on that same net income as a gauge of a self-employed
Borrower’s earnings. That is great for minimizing your income tax liability but
hurts your ability to qualify for a mortgage. The second major problem for the
self-employed is that nearly all Mortgage Lenders require that Borrowers beself-employed for at least two full years. For the Lender, this means showing
the last two years of tax returns showing two full years of self employment income. Since most people do not start their business exactly on January 1,
what this really means is that you need to be self-employed for two January to
December years in order to meet the two year test. Self-employed individuals
are not necessarily more or less of a financial risk than employed Borrowers.
However, the manner in which Borrowers are reviewed by underwriters for loanapprovals can often make a self-employed Borrower’s financial position look
worse than it actually is.
In the current mortgage
environment, self-employed mortgage Borrowers will be required to document
every aspect of their business and can expect to have every part of their tax
returns and business Bank statements reviewed to make sure they are reallymaking the income claimed on their tax return.
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