Self Employed Mortgages
Getting a mortgage when you’re self employed can feel challenging, but it doesn’t have to be.
Securing a Mortgage When You’re Self-Employed
If you're self-employed and wondering whether obtaining a mortgage is possible, you’re not alone. Getting a mortgage as a freelancer, sole trader, contractor, or business owner can feel daunting—lenders often view self-employed applicants as higher risk due to irregular income and less formal documentation. However, with the correct preparation and guidance, you can confidently navigate the process and secure a suitable mortgage tailored to your circumstances
- Provide proof of income through tax returns and business accounts.
- Show at least two years of trading history or steady earnings.
- Work with a specialist broker to access suitable lenders and products.
How can we help you?
Contact us at Templar Mortgages - 0121 453 4244.
Mortgages for the Self-Employed
For many self-employed people, buying a home or refinancing can feel more complicated than it should be. Lenders often see freelancers, sole traders, contractors and company directors as higher risk because their income does not come in the form of a fixed salary. The good news is that being self-employed does not mean you cannot get a mortgage. It simply means you may need to provide more detailed evidence of your earnings and plan your application carefully. With the right preparation and guidance, securing a mortgage while self-employed is very achievable.
What Is a Self-Employed Mortgage?
A self-employed mortgage is not a special type of product. It is essentially the same as any other mortgage, but the way lenders assess affordability is different. Instead of reviewing payslips, lenders will rely on your business accounts, tax returns and proof of income over a period of time. Some lenders may also ask for a larger deposit or apply stricter criteria to ensure they are comfortable with the level of risk.
Who Is Considered Self-Employed?
Most lenders will classify you as self-employed if you own 25% or more shares in a company and your main source of income comes from it. This includes sole traders, partners in a business, freelancers and company directors. Many lenders prefer at least two years of trading history, though some will consider applications with less if you can show reliable income.
Evidence You Will Need
To support your application, lenders usually require two or three years of tax calculations and tax overviews, commonly known as (SA302's forms) issued by HMRC.
Certified business accounts prepared by a qualified accountant are also commonly requested, along with recent bank statements showing income and expenditure. In some cases, proof of upcoming contracts or future work may help to strengthen your application.
Improving Your Chances of Approval
If you are self-employed and want to improve your chances, keeping your accounts up to date and paying taxes on time will demonstrate financial responsibility. A larger deposit can reduce the lender’s risk and open up more competitive mortgage options. Maintaining a good credit history, reducing personal debts and making sure you are on the electoral roll will also enhance your profile.
Working with a mortgage broker who specialises in self-employed applications can be especially valuable. They will know which lenders are more flexible with non-salaried applicants and can guide you towards products best suited to your situation.
How Long Does the Process Take?
A self-employed mortgage application usually takes a similar amount of time as a standard one, typically between eight and twelve weeks from application to completion. Delays may occur if additional documents are needed, which is why being organised from the outset helps keep the process on track.
Making Homeownership Possible When Self-Employed
Getting a mortgage when you are self-employed may take more preparation, but it is certainly possible. By gathering the right paperwork, maintaining good financial records and seeking expert advice, you can put yourself in the strongest position to be approved. With specialist lenders and brokers increasingly offering products designed for self-employed clients, there are more opportunities than ever to secure a suitable deal.
With the right approach and support, you can achieve your goal of owning a home or refinancing a property while self-employed and take confident steps towards your financial future.
FAQ : Self Employed Mortgages
Can self-employed people get a mortgage in the UK?
Yes, self-employed individuals can secure mortgages, but the process is often more detailed than for employed applicants. Lenders require proof of stable income and evidence that the business can sustain repayments over the long term.
What income proof do I need for a self-employed mortgage?
Most lenders ask for two to three years of accounts or tax returns, such as SA302 forms and HMRC tax year overviews. Some may also consider one year of accounts: 12 months trading with SA302’s and or accounts plus an accountant’s letter / projection of turnover. Some lenders will accept 12 months trade in as long as you have your SA302 or your accounts. Your accountants letter and accounts proj if you have a strong financial profile and consistent earnings.
How much can I borrow if I’m self-employed?
The amount depends on your income, credit history, and overall financial commitments. Typically, lenders will offer a loan based on four to five times your verified annual income, though this varies depending on circumstances.
Do self-employed mortgages have higher rates?
Not necessarily. If you can provide solid financial evidence and have a good credit rating, you can usually access the same competitive rates as employed applicants. However, limited accounts or irregular income may restrict your options.
How can I improve my chances of approval?
Keeping accurate and up-to-date accounts, filing tax returns on time, and maintaining a strong credit score can all strengthen your application. Using a specialist mortgage broker who understands self-employed lending criteria can also make the process smoother and increase your chances of finding the best deal.
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