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 much 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 blog, we’ll walk through what lenders look for, what you’ll need to prepare, and how working with a broker can make the journey much smoother.
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 will assess your income a little differently. Most will want to see your earnings over the last two years, so having access to your accounts or HMRC self-assessment documents early on is key. Speaking to your accountant before you apply can save time and help you prepare the right paperwork.
What Documents Do Self-Employed Buyers Need?
This depends on how your business is set up, so whether you're a sole trader, Limited Company director, contractor, or in a partnership. As a general rule, lenders will ask for:
• Last two years’ SA302s (tax calculations)
• Last two years’ tax overviews
• Last two years’ accounts
• Last three months’ business bank statements
The most recent 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 two years of accounts. If you’ve only been trading for one year, you may still be able to get a mortgage, but your options will be more limited.
Do Self-Employed Applicants Need a Bigger Deposit?
Not usually. Being self-employed doesn’t automatically mean you’ll need to put down more. However, if you’ve only got one year of trading history or your income is harder to verify, you might find that you can’t borrow as much. In those cases, a larger deposit could help bridge the gap.
Can I Use Retained Profits or Dividends to Support My Application?
Lenders commonly accept dividends, usually taking an average over the last two years. Retained profits are trickier, as most mainstream lenders won’t include them, but there are specialist lenders who 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?
It can. Lenders often use the lower figure if your income has dropped year-on-year. If it’s increased, they’ll usually take an average. If there’s a one-off dip for a specific reason, like illness or a gap in contracts, we can ask lenders if they’ll take a more flexible view. The key is to explain the context and provide supporting evidence.
How Long Does the Mortgage Process Take?
If everything goes smoothly, you’ll be looking at around 6–8 weeks from application to completion. But there are many moving parts, such as valuations, solicitor timelines, and whether you’re in a chain, which can all affect the pace.
If a lender requests additional documents midway through your application, that can slow down the process. This is why it’s so important to speak to us first so we can ensure all documentation is submitted upfront.
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 three 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.
