How to Get a Mortgage if You’re Self‑Employed: The Complete UK Guide:
- Jake W
- 59 minutes ago
- 4 min read
How to Get a Mortgage if You’re Self‑Employed:
Getting a mortgage when you’re self‑employed can feel like navigating a maze but it doesn’t have to. With the right preparation, documents, and guidance, self‑employed buyers secure mortgages every day. The key is understanding what lenders look for and how to present your income clearly and confidently.
This guide breaks down how to get a mortgage if you’re self‑employed, the documents you’ll need, how lenders assess affordability, and the steps you can take to boost your chances of approval.
What Counts as “Self‑Employed” for a Mortgage?
Most UK lenders class you as self‑employed if you own 20–25% or more of a business that provides your main income. This includes:
Sole traders
Limited company directors
Partners in a business
Freelancers
Contractors
Each setup is assessed slightly differently, but the core principle is the same: lenders want to see stable, provable income over time.
Why It Can Be Harder to Get a Mortgage When Self‑Employed
Self‑employed income can fluctuate, and lenders prefer predictability. Common challenges include:
Irregular income patterns
Lower declared income due to expenses
Short trading history
Stricter affordability checks
Lenders who prefer employed applicants
But “harder” doesn’t mean “impossible.” With the right preparation, you can absolutely secure a competitive mortgage. Book Online | Well Financial
What Documents You Need for a Self‑Employed Mortgage
Lenders will want to see clear evidence of your income and business stability. Typically, you’ll need:
For Sole Traders & Freelancers
2–3 years of SA302s
Tax Year Overviews
Business accounts (if available)
3–6 months of bank statements
For Limited Company Directors
2–3 years of full company accounts
SA302s and Tax Year Overviews
Business bank statements
Proof of retained profits (some lenders count this)
For Contractors
Current and previous contracts
Day rate evidence
CV showing work history
How Lenders Assess Self‑Employed Income
Lenders don’t just look at your top‑line turnover — they dig deeper.
Sole Traders
They usually average your net profit over the last 2–3 years.
Limited Company Directors
Lenders may assess:
Salary + dividends, or
Salary + retained profit (depending on lender)
Contractors
Many lenders use a day‑rate calculation, often: Day rate × 5 × 46 weeks
Important:
If your most recent year’s income is lower than previous years, lenders may use the lower figure, not the average.
How Much Can You Borrow When Self‑Employed?
Most lenders offer around 4–4.5× your income, but this varies based on:
Credit history
Debt levels
Deposit size
Business stability
Loan‑to‑value (LTV)
Recent income trends
Some lenders restrict borrowing at higher LTVs for self‑employed applicants.
How to Boost Your Chances of Getting a Self‑Employed Mortgage
Here are the most effective steps you can take:
1. Improve your credit score
Check your credit file before applying and correct any errors.
2. Reduce unnecessary expenses
Lenders will scrutinise your bank statements for the last 3–6 months.
3. Build a bigger deposit
A lower LTV often means better rates and easier approval.
4. Avoid big business changes
Switching from sole trader to limited company right before applying can complicate things.
5. Keep your accounts up to date
Lenders prefer accounts prepared by a chartered accountant.
6. Avoid new credit applications
Hard searches can reduce your score and raise affordability concerns.
7. Work with a mortgage adviser
Brokers know which lenders are self‑employed‑friendly and which to avoid.
Can You Get a Mortgage With Only One Year of Accounts?
Yes, but your options are more limited. Some lenders will consider you with one year of trading, especially if:
You have experience in the same field
Your income is stable
You have a strong deposit
You work with a specialist broker
What If You Have Gaps in Your Work History?
Gaps longer than 8 weeks may raise questions. Lenders want reassurance that your income is sustainable, so be prepared to explain any breaks.
Can Self‑Employed Buyers Get 95% Mortgages?
Yes but it’s more challenging. Some lenders won’t offer high‑LTV products to self‑employed applicants, and those that do will scrutinise affordability closely.
Book in for a quick chat and we can help you get on the ladder. Book Online | Well Financial
Step‑by‑Step: How to Get a Mortgage When You’re Self‑Employed
1. Gather your documents early
Don’t wait until you’ve found a property.
2. Check your affordability
Use a mortgage calculator to estimate borrowing power.
3. Speak to a mortgage adviser
They’ll match you with lenders who understand self‑employed income.
4. Get an Agreement in Principle (AIP)
This strengthens your position with estate agents.
5. Submit your full application
Your adviser will package your documents to present your income clearly.
6. Wait for underwriting
Self‑employed applications may take slightly longer due to extra checks.
Final Thoughts
Being self‑employed shouldn’t stop you from owning a home. With the right preparation, clear documentation, and expert support, you can secure mortgage that fits your circumstances and long‑term goals. If you need assistance with getting a mortgage if you're self employed or any other type of mortgage feel free to book in for a quick no fuss chat and we can run through your options. Book Online | Well Financial
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