Looking to purchase your dream home, but worried that being self-employed will restrict your mortgage options? Here, we answer the common questions we hear from clients to help you get started with your application.
There’s a common misconception that getting a mortgage is harder if you're self-employed, but that’s not necessarily true. While the process can involve a few extra steps, being self-employed doesn’t mean you're at a disadvantage.
The key difference is how lenders assess your income, which means having the right documentation and a clear understanding of your financial history is essential.
In this guide, we break down how the process works, what lenders expect, and how a broker can help you secure the right mortgage with confidence.
Is It Harder to Get a Mortgage When You're Self-Employed?
Not necessarily. Being self-employed doesn’t mean you can’t get a mortgage; it just means lenders assess your income a little differently and need more evidence to verify how much you earn.
Most want to see at least 2 years of earnings, usually through your accounts or HMRC self-assessment documents. Speaking to your accountant before you apply can help ensure your figures are up-to-date and your documents are ready before you apply.
What Documents Do Self-Employed Buyers Need?
The documents you’ll need depend on whether you're a sole trader, Limited Company director, contractor, or in a partnership. As a general rule, lenders ask for:
- Last 2 years’ SA302s (tax calculations)
- Last 2 years’ tax overviews
- Last 2 years’ accounts
- Last 3 months’ business bank statements
These documents should be dated within the last 18 months.
It's important to note that this list isn't exhaustive. Our brokers are happy to help you collate your documents before submitting your application to save you time and money.
How Many Years of Accounts Do You Need?
Most lenders will want to see 2 years of accounts. If you’ve only been trading for 1 year, you may still be able to get a mortgage, but your lender options will be more limited, and affordability may be assessed more cautiously.
Do Self-Employed Applicants Need a Bigger Deposit?
Not usually. Being self-employed doesn’t automatically mean you’ll need to put down a larger deposit. However, if you’ve only got 1 year of trading history or your income is harder to verify, you might find that lenders offer a lower loan amount. In those cases, a larger deposit could help increase your options.
Can I Use Retained Profits or Dividends to Support My Application?
Lenders commonly accept dividends, usually taking an average of your income over the last 2 years. Retained profits are trickier: most mainstream lenders won’t include them, but specialist lenders will. If you’re relying on retained profits to boost your affordability, it’s important to speak to a broker early so we can match you with the right lender.
Will Fluctuating Income Impact My Application?
Yes, fluctuations can affect how lenders calculate your income:
- If your income has decreased, lenders often use the lower figure
- If your income has increased, they may take an average
- If your income has dropped due to a one-off event (such as illness, maternity leave, contract gap, etc), we can ask lenders if they’ll take a more flexible view
How Long Does the Mortgage Process Take?
If everything goes smoothly, you’ll be looking at around 6–8 weeks from application to completion. However, timelines can vary depending on:
- Valuation availability
- Solicitor turnaround times
- Whether you’re in a chain
- Whether the lender requests additional documents
Speaking to us first ensures that all necessary documentation is submitted upfront, which should help you avoid delays.
What Other Documentation Do I Need to Provide?
For sole traders, you’ll need access to your SA302s, tax overviews, and possibly SA100s (your full tax return). Limited Company directors may need slightly different documents, depending on how your income is structured. You’ll also need your last 3 months’ business bank statements. A broker can advise exactly what’s required based on your setup.
Why Should Self-Employed Applicants Use a Broker?
The self-employed mortgage journey can feel more complex, but it doesn’t have to be.
Working with a whole-of-market mortgage broker will give you the confidence you need throughout the application process. We'll find the right lender to suit your needs, not just the one offering the lowest rate, but one that understands your income structure and is happy to work with it.
We’ll also ensure your documents are in order, run affordability checks before submitting, and manage the application through to completion, liaising with solicitors and keeping everything on track.
If you're self-employed and planning to buy or remortgage, we’d love to help. Call us on 0345 345 6788 or submit an enquiry here.
