Self-Employed Mortgages

We are here to dispel the myth that it is harder to get a mortgage if you are self-employed. With the expert advice from our experienced brokers, you will see that being self-employed does not make mortgage lenders less likely to approve your application than if you were employed, provided that you can prove your income and you can afford the payments.




Lenders will view you as self-employed if you own more than 20% to 25% of a business, from which you earn your main income. Lenders are pretty flexible when it comes to the sector in which you work. Almost all occupations are acceptable providing that the business is viable, and the income is sustainable. You could be a builder, a plumber or any other tradesmen, a musician or an actor, you may work in the financial sector or have an online business, to name just some examples.

When you set up your own business you have a choice of three main business structures to choose from: sole trader, partnership or a limited company. Below we explain in detail the evidence of income you have to provide for each type of company.

What about contractors and freelancers?

These are just different ways of being self-employed. Being self-employed is an umbrella term for anyone who pays themselves through their own work and both freelancers and contractors fall in this category. The main difference is the way they work and the industries they are associated with but, in terms or income, paying tax or mortgage eligibility, same rules apply. Some freelancers and contractors are registered as sole traders while others chose to work through their own limited company. 




There is actually no such a thing as “self-employed mortgages”. Any mortgage for self-employed applicants will almost always be the same as for employed applicants. It just depends on which lender will accept you so as long as you’re eligible and you’re able to prove your income, you should have the same range available as anyone.

Our mortgage brokers have a wealth of experience in dealing with self-employed income and they can discuss your mortgage options with you on 01242 697821.


Contact Us About Self-Employed Mortgages





As a self-employed applicant you have access to the same range of mortgages as everybody else and you’ll need to pass the same affordability tests. But, because there is no contracted salary from an employer, self-employed people are required to provide more evidence of their income than other borrowers.

The evidence of income depends on how your company is set up.

  • Sole trader

Sole traders are one-man bands and keeping accounts should be fairly straightforward. The lender will look at net profits when assessing your income. If you do your tax by self-assessment you will get a form called an SA302, which shows the total income received and total tax due. This form will be requested by some lenders as proof of income, while other lenders will look at your accounts and net profits only.

  • Partnership

If you go into business with someone else, you might set up a partnership. When assessing your income, mortgage lenders will look at each partner’s share of the net profit so make sure you have accounts that show exactly how much money you made so the lender can see your annual income. As with the sole traders, some lenders will request to see your SA302s as evidence of income.

  • Limited company

Setting up a limited company means you keep your business separate from your personal affairs. A limited company will have at least one director and, in some cases, a company secretary. Directors normally pay themselves a basic salary plus dividend payments and this is what will be taken into accounts by the lender when assessing your affordability.






Even though requirements may vary with lenders and depending on how your business is set up, generally you will need to prepare the following when applying for a mortgage:

  • At least one years’ certified accounts
  • SA302 form and the Tax year overview (from HMRC) for at least one year of business 
  • Evidence of upcoming contracts, if you’re a contractor
  • Evidence of dividend payments or retained profits, if you’re a company director
  • Projected accounts

Having accounts for at least two years is preferable, making it less challenging to prove your reliability and giving you more choice of lenders. Saying that, it is possible to get a mortgage with only one years’ accounts especially if you can prove a track record of regular work, if you have left employment to work as a contractor in the same industry, or you have evidence of work lined up for the future.

There are a couple of common problems you may come up against when proving your income:

  • legally reducing your taxable income in order to pay less tax. This could be problematic when applying for a mortgage and you need to show the biggest income possible. 
  • If you’re a director of a limited company, you might have profits that you choose to retain in the business, rather than take out as salary or dividends. Bear in mind that not all lenders will take into account retained profits when assessing an application. 

That is why it’s a good idea to seek advice from both your accountant and a mortgage broker before you apply for a mortgage.

The application process is similar with any other type of mortgages and, together with proof of income, lenders will require:

  • Proof of identity, such as passport or driving license 
  • Proof of address, such as Council Tax bill or utility bills, dated within three months from application 
  • Three to six months’ worth of bank statements

Lenders will want to examine your bank statements to look at how much you spend on bills and other costs to be certain you could afford your mortgage repayments. They will analyse outgoings such utility bills, travel and commuting costs, holidays and socialising, childcare, credit card and loan repayments. 

You can save yourself time and hassle by letting Fairview Financial deal with the entire mortgage process, from application until completion. Get in touch to see how we can help.


Contact Us About Self-Employed Mortgages




Using a whole of market mortgage broker like Fairview Financial will not only save you the hassle of the application process but will also give you access to a wider panel of lenders, including specialist lenders not available on the high-street, which can in turn increase your chances of getting a mortgage. Our experienced brokers also know when and where great mortgage deals are to be had, and which lenders would consider your application based on your circumstances, before you even start. 

There are certain things you can do to boost your chances of getting a mortgage if you are self-employed:

  • Save as much as possible for a healthy deposit or, if you are a homeowner, it will help to have a good amount of equity in your existing property 
  • Have a good credit history 
  • Check your credit report and correct any issues. Bear in mind that lenders will not just credit check you but will also credit check your business by running a check on your business address
  • Get on the electoral roll 
  • Make sure your accounts are up-to-date and in good order 
  • Employ an accountant to prepare your self-employed accounts; some lenders prefer the accountant to be certified or chartered
  • Avoid buying certain properties such as flats above commercial premises or old or unusual buildings as lenders are less willing to lend on these

To get more information or speak to our team of advisers contact us on 01242 697821 or email us at info@fairviewfinancial.co.uk.


 Contact Us About Self-Employed Mortgages





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