Northern Rock eases self-employed lending criteria

Northern Rock has relaxed its criteria for self-employed mortgage borrowers, in a policy-change that freelancers looking to get on the property ladder will hope other lenders follow.

Speaking to a mortgage industry journal, the taxpayer-backed bank said self-employed people with a trading history of two years, down from the previous three, were now eligible.

The move follows concern that the self-employed still approach home loans with fear of rejection, despite the availability of specialist contractor mortgages based on their annualised contract rate.

“The change to the self-employed policy is in the interest of our customers”, a Northern Rock spokesman told Mortgage Solutions.  “If they have two years worth of accounts then they will be in their third year of trading.”

The policy change is within the lender’s “risk appetite,” the spokesman added, and self-employed customers will still be required to present two years’ worth of trading accounts.