If you’re self-employed, getting a mortgage can feel more complicated than it should be. The reality is lenders aren’t trying to make things difficult – they simply need to understand your income in a different way compared to someone on PAYE.
The good news is that plenty of lenders are open to self-employed applicants. With the right preparation and advice, securing a mortgage is absolutely achievable.
If you want a clear idea of what you could borrow based on your income, you can speak to us
Email: mortgageadvice@veracityfp.co.uk
Or
Call: 0115 967 0888
What Counts as Self-Employed?
In mortgage terms, you’re typically considered self-employed if you own 20–25% or more of a business. This includes:
- Sole traders
- Partnerships
- Limited company directors
- Contractors and freelancers
Each structure is assessed slightly differently by lenders, particularly when it comes to how your income is calculated.
How Lenders Assess Your Income
This is where things differ most compared to employed applicants.
Sole traders & partnerships
Lenders usually look at your net profit, typically averaged over the last two to three years.
Limited company directors
There are a few approaches depending on the lender:
- Salary + dividends
- Salary + net profit (retained profit included)
- Or a mix depending on the case
This is why choosing the right lender is critical — different lenders can produce very different affordability results.
We regularly help clients structure their applications in the most favourable way – if you’re unsure how your income will be assessed, get in touch and we’ll talk it through.
Email: mortgageadvice@veracityfp.co.uk
Or
Call: 0115 967 0888
How Many Years of Accounts Do You Need?
Most lenders prefer at least two years of accounts. However:
- Some lenders will consider just one year
- Others may accept fast-growing businesses with strong projections
If you’re newly self-employed, it doesn’t automatically mean you can’t get a mortgage — it just narrows the options slightly.
If you’ve only got one year of accounts, it’s worth having a conversation early so you know exactly where you stand.
What Documents Will You Need?
Be prepared to provide:
- SA302s and Tax Year Overviews (usually last 2–3 years)
- Full accounts prepared by an accountant
- Business bank statements
- Personal bank statements
- Proof of ID and address
If you’re a limited company director, lenders may also want to see company accounts and your share of ownership.
Deposit Requirements
The bigger the deposit, the stronger your position.
- 5–10% deposit: possible, but fewer options
- 10–15%: more choice and better rates
- 20%+: strongest position
Self-employed applicants don’t always need a bigger deposit, but in more complex cases, it can help offset perceived risk.
Common Challenges (and How to Overcome Them)
Fluctuating income
Many businesses have ups and downs. Lenders will often average your income, so consistency helps.
Tip: If income has recently increased, some lenders will use the latest year — not the average.
Tax efficiency vs borrowing power
It’s common to minimise taxable income, but this can reduce what lenders think you earn.
Tip: Speak to both your accountant and mortgage adviser before making big financial decisions if you’re planning to buy.
Recent changes in business structure
Switching from sole trader to limited company (or vice versa) can complicate things.
Tip: Work with a broker who can place your case with lenders comfortable with these changes.
How to Improve Your Chances
A few simple steps can make a big difference:
- Keep your accounts up to date
- Avoid large unexplained spending before applying
- Maintain a clean credit record
- Register on the electoral roll
- Work with an experienced mortgage adviser
The biggest advantage you can give yourself is presenting your income clearly and accurately to the right lender.
At Veracity Financial Planning, we specialise in exactly this — matching self-employed clients with lenders that understand their income.
Why Advice Matters for Self-Employed Mortgages
Not all lenders treat self-employed income the same way — and that’s where advice makes the difference.
A good adviser will:
- Match you with lenders suited to your situation
- Structure your application correctly
- Help you present your income in the strongest possible way
- Save you time and avoid unnecessary declines
Being self-employed doesn’t put home ownership out of reach — it just means the process needs a bit more care.
With the right preparation and guidance, self-employed clients can access competitive mortgage options just like employed applicants.
Ready to Take the Next Step?
If you’re self-employed and thinking about getting a mortgage, the best place to start is understanding your options.
Get in touch for a no-obligation chat about your situation.
We’ll give you straightforward, honest advice — and help you move forward with confidence.
Email: mortgageadvice@veracityfp.co.uk
Or
Call: 0115 967 0888
