Can You Get a Mortgage if You are Self Employed?

There are now a larger number of self-employed individuals than ever before – more than 5 million in the UK – and the amount of independent workers could soon over take those employed in the public sector. No matter how successful or financially secure you may be, it can still be very difficult to secure a mortgage if you have your own business.

Although hard to secure, it is not impossible to get a mortgage if you are self-employed. The key is preparing in advance.

Does Business Set-Up Affect Your Application?

Businesses fall into three main structural categories: sole traders, partnerships and limited companies. Which of the three your business falls into can have a big impact on how lenders view the safety of your income.

Sole Traders – When applying for a mortgage as a sole trader, your lender will usually request proof of two years' worth of income. If you complete your own tax self assessment, you may need to provide your total income earned and tax paid via an SA302 form.

Partnerships – Similarly to sole traders, when you own a business with someone else, you will need to prove your portion of taxable income. However, make sure to keep accurate and up-to-date accounts, as you need to be able to show how you split net profits.

Limited Companies – As the director of a limited company, your income probably consists of a basic salary and additional dividend payments. Lenders usually consider both components when assessing a mortgage application, though they may be judged differently based on ownership share.

How Will Your Mortgage be Calculated?

The way a lender calculates rates and amounts varies wildly. While one lender may base your borrowing limit over several years worth of income, another may ask you to include projections of future earnings, but others may calculate using earnings over the last twelve months.

To get the best mortgage, speak to different lenders, shop around and make sure to look into companies such as Saffron Building Society, who offer mortgages catered to the self-employed.

How Can You Maximise Your Chances?

• Make sure you have your SA302 tax form ready as they can take time to arrive in the post
• Increase your deposit to decrease your borrowing amount
• Lenders want to know that you are stable, so aim to increase profits on a yearly basis
• Delay altering the structure of your business as this could hurt your application

When you are self employed you enjoy the benefits of being your own boss. You get to run your own business and determine your own destiny. But when applying for a mortgage you are in the hands of someone else and they are going to decide if you get one or not. As stated before the key is to prepare in advance.

Is Your Company Health Insurance Enough for You?

Does your employer provide health insurance? If the answer is yes - that’s great, but there are a few things you may want to consider in order to determine if your corporate health insurance plan is adequate enough to cover most or all of your healthcare related expenses. 

Health insurance is often offered by companies as an additional perk, and as such, rarely do we really look into what’s actually covered by our plan, or compare it with other plans.

While company-sponsored health insurance does provide us with access to superior care offered in private facilities (e.g. shorter waiting times and additional privacy), some group policies may offer only basic benefits with low limits or coverage elements, meaning that you may end up having to pay a large and completely unexpected out-of-pocket medical bill! 

This article by global insurance advisor Pacific Prime Singapore highlights the things you may want to consider in order to find out if your company health insurance is enough for you.

How protected are you?

Let’s face it, most people don’t apply the same degree of due diligence on health plans provided by their employers as they would on other plans. It’s a good idea to firstly find out what coverage levels are provided, these include:

Inpatient only: This is the most basic (and usually the cheapest) form of health insurance, and will cover hospitalization costs only. Any other expenses (e.g. visiting the GP) are not covered.

Inpatient and outpatient: With this type of plan, you’ll enjoy coverage for both inpatient and outpatient expenses.

Full coverage plans: If you’re lucky enough to be given a full coverage company health insurance plan, additional benefits such as coverage for dental care or mental health will also be included, on top of your inpatient and outpatient coverage benefits.

Coverage limits

To save on costs, companies will typically purchase group plans with low coverage maximums, meaning that once this limit has been reached, the patient could end up spending hundreds and thousands on treatment. 

For further peace of mind and to reduce financial risk, a top-up insurance plan is recommended for taking away that financial liability and adding additional coverage elements that your company health insurance may not have provided.

What about copayments and deductibles?

Employers may shift some of the company health insurance costs onto their employees by providing plans with high copayments and deductibles. This is because premiums on plans will tend to be lower when copayments and deductibles are higher.

Copayments are a fixed amount you agree to pay for every claim, and a deductible is an amount you will need to pay each year or for each claim. 

If your company health insurance copayment or deductible is too high, you may want to offset these risks with a top-up plan.

Pre-existing conditions

Another thing to be aware of is whether your company’s health insurance plan covers pre-existing conditions. Common pre-existing conditions include chronic diseases such as diabetes, asthma, and high blood pressure. 

Receiving treatment for these conditions can be expensive, which is why some plans don’t cover this or have limits that are too low to cover the bulk of the costs related to treating chronic conditions, meaning that employees may need to purchase top-up insurance.

Portability: does it cover you abroad?

How portable is your health insurance plan? Unforeseen accidents can happen anywhere, no matter how safe a country is, so it’s essential to be covered wherever you go. 

It is therefore essential to double check the regions covered by your company health insurance policy. Most plans will cover you in one region only, as they tend to be cheaper. 

People with local company health insurance policies will usually purchase top-up plans that provide international coverage, or purchase travel insurance every time they go abroad for additional peace of mind.

It can be confusing going through all the fine print of your corporate health insurance plan all on your own, which is why it often pays to talk to a trusted broker like Pacific Prime Singapore for additional advice.

About the author

If you are looking for the best value health insurance plans on the market, why not visit Pacific Prime Singapore’s Company Health Insurance Page to purchase your plan today? Their team of experienced insurance advisors offer a wealth of experience that you can rely on.

Random Philosophical Musings on Aging

One of the things about reaching senior years is that we don’t like to think about all those things we can no longer do or all the things we have left to do but little time in which to accomplish them. 

Our lives have been a whirlwind of activity in which we were always so busy that we really didn’t realize how quickly time was slipping away from us. Now, as our senior years are approaching, many of us begin musing on the meaning of life and why we age. 

Here are some random philosophical musings on aging which many of us face as those dreaded 60s approach.

Does Aging Serve a Purpose?

Some of the most revered ‘thinkers’ of our day have spent years pondering the purpose of aging. 

It doesn’t take having an online masters degree in philosophy to understand the importance of this question, although a degree of that nature does help us discover answers from some of the world’s greatest philosophers to have walked the face of the earth. 

Both Socrates and Plato were known to have philosophized on the nature of aging and both are often quoted as we try to make sense of this body that no longer works as it once had, or the mind that is still sharp, albeit slower to respond than it once had been. 

So, does aging serve a purpose from a philosophical vantage point? Some say it does.

Why the Musings of an Aging Philosopher Really Matter

When we are young, it seems as though we are always at the top of our game. There is little we don’t know, little we can’t do and God help the person who doubts our abilities and aptitudes. 

However, as we age we realize that there is so much more to learn because there is so much we don’t know. It is at this point that an aging philosopher can begin guiding the generation seeking the answers they once sought at that age and time.

These musings have meaning in that they are able to guide future generations in the mysteries of life. 

Science explains much but there is much more which science is unable to answer and here is where thought and matter converge.

A Generation of Aging Philosophers Is at the Door

Now, at a time when science is advancing faster than the speed of light, there is an entire generation of aging philosophers at the door listening to see what science can explain and waiting to fill in the gaps where science has no answer. 

These are the Baby Boomers of the late 1950s through the early 1960s, the biggest generation ever to age all at one time.

We are those aging philosophers who have yet to be heard. This is the time in our lives when things begin to slow and we have time on our hands to ponder all the things we were once too busy to see. 

Perhaps this is the time to join an online masters degree in philosophy program so that other, younger philosophers will be there to hear our musings and carry them forward through a time when most are still too busy to hear, too busy to think and yes, too busy to live. 

These random philosophical musings on aging are meant to be shared.

Home Renovations To Make Your Fixed Income Go Further

Living on a tight budget is challenging and even stressful at times, and you may be searching for every possible way to reduce spending. 

While eliminating your cable TV and buying generic food rather than name brand food are common solutions that those living on a tight budget pursue, another great idea is to make a few improvements around the house. 

These ideas will help you to reduce your energy costs and to save money over the coming years. While some will result in modest savings on a monthly basis, the total that you may save over the course of a year can be significant.

Replace Your Doors and Windows

Your home's doors and windows are more than just aesthetic features that enhance curb appeal. They also have insulating benefits that can minimize temperature transfer. In addition, some windows have UV protection that further prevent temperature transfer. 

You can learn more about the stylish features available for use in your home through specialty window and door companies, like Arch Design.

Replace Your Hot Water Heater

Another great idea is to replace your current hot water heater with a newer model. The best option for most homes is to use a tankless hot water heater. 

A tank-style hot water heater keeps water stored in the tank at a warm temperature, and this even occurs when no water is being used. As you can see, this wastes energy throughout the day. 

A tankless hot water heater is a better solution because it only heats water when it is needed, and this can reduce your energy consumption on a daily basis.

Invest in LED Lights

A significant amount of energy may also be used to light up your home. Different types of light bulbs use varying amounts of energy. LED lights are one of the most energy efficient options available. 

Plus, these bulbs last longer than traditional bulbs, which means you have less maintenance costs with them. If you want to save money on energy and on maintenance costs, you can exchange your incandescent bulbs with LED lights.

If you are ready to start saving money at home, you can consider implementing these ideas. Some may be done with a significant amount of up-front money, such as a water heater replacement. 

However, replacing doors, windows and light bulbs may be done slowly over time as your budget allows. As you begin to make these changes over time, you will begin to see an even greater improvement in your home energy bills.