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How to Get a Mortgage When You're Self-Employed

  • ajitkainth
  • 2 days ago
  • 4 min read
Self Employed mortgage in Birmingham
Self Employed mortgage in Birmingham

Self-employed applicants often face stricter lending criteria, making it harder to secure the amount they need. However, with the right self-employed mortgage advice, and support from specialist lenders, it’s very possible to get a good deal.

In this guide, we’ll explain how to apply for a mortgage as self-employed, what documents you’ll need, and how to boost your borrowing potential.


Key Takeaways

  • Self-employed applicants need at least 2 years of accounts or SA302s to apply.

  • The best time to apply is when your income is stable and well-documented.

  • Specialist lenders and brokers offer tailored products for self-employed workers.

  • Good credit, a healthy deposit, and clean records maximise your chances.

  • Always consult a mortgage adviser for self-employed mortgage advice.


Table of Contents

  1. Introduction

  2. Key Takeaways

  3. Self-Employed Mortgage Advice

  4. When Is It a Good Idea to Apply for a Mortgage If Self-Employed?

  5. What You Need to Apply for a Mortgage as Self-Employed

  6. Choosing a Self-Employed Mortgage Provider

  7. Applying for a Mortgage as Self-Employed

  8. How to Maximise Your Borrowing Potential if You’re Self-Employed

  9. Frequently Asked Questions (FAQs)

  10. Get Started with ApeFinance


Self-Employed Mortgage Advice

Self-employed individuals are assessed differently than salaried applicants. Lenders will want to see consistent income and robust financial records over several years. Typically, mortgage lenders require at least two to three years of accounts or SA302 tax calculations provided by HMRC.


To improve your position:

  • Maintain clean and up-to-date financial records

  • Avoid mixing business and personal finances

  • Work with a specialist mortgage broker who understands self-employed applications


Tip: Keep your credit score healthy by paying bills on time and reducing existing debt.


When Is It a Good Idea to Apply for a Mortgage If Self-Employed?

The best time to apply is after at least two years of stable trading history with consistent or increasing profits. You’ll also be in a better position if:

  • Your business has recovered from any downturns (e.g., due to COVID-19)

  • You’ve recently filed your latest tax return

  • You have a sizable deposit (15–20% or more)


Avoid applying during a financial lull or soon after starting your business. Mortgage lenders are risk-averse and want to see evidence of sustainability and growth.


What You Need to Apply for a Mortgage as Self-Employed

To apply successfully, prepare the following documents:

  1. SA302 Forms (Last 2–3 Years) – Available via HMRC or your accountant

  2. Full Accounts – Certified by a chartered accountant, covering profit and loss

  3. Bank Statements – Typically six months of personal and business accounts

  4. Proof of Deposit – Evidence of savings or gifted funds

  5. Credit Report – Clean credit history improves your chances

  6. ID and Proof of Address – Passport, driving licence, utility bills


Note: The more consistent and transparent your income records, the more favourable you’ll appear to lenders.


Did You Know?

Some specialist mortgage lenders will consider applications from self-employed individuals with just one year of trading history, provided your income is strong and stable, and you have a solid deposit.

Additionally, if you're a limited company director, some lenders may take retained profits and dividends into account not just your salary giving you more borrowing power than you might expect.


Choosing a Self-Employed Mortgage Provider

Not all lenders treat self-employed applicants equally. While high-street banks may impose rigid criteria, specialist lenders often take a more flexible view of income especially for sole traders or company directors.


When comparing mortgage providers, consider:

  • Do they accept retained profits for company directors?

  • Are they open to less than two years of accounts (some accept 1 year)?

  • Do they factor in gross turnover or net profit?

  • Are there brokers who specialise in self-employed mortgages?


Working with a mortgage adviser or broker experienced in self-employed applications is often the best way to identify the right lender.


Applying for a Mortgage as Self-Employed

Once you've chosen a lender, the application process is similar to that of a traditional mortgage just with more paperwork. Here’s how to apply for a mortgage as self-employed:

  1. Speak to a Broker – Get pre-qualified to see how much you could borrow.

  2. Submit Financial Documentation – Provide all requested income verification.

  3. Get a Mortgage in Principle – A statement from the lender showing what you may be able to borrow.

  4. Find a Property – Once you have a figure, start your property search.

  5. Make a Full Application – Submit your documents, ID, and bank statements.

  6. Valuation and Underwriting – The lender will assess the property and your financial health.

  7. Receive Your Mortgage Offer – If approved, your solicitor can start conveyancing.


How to Maximise Your Borrowing Potential if You’re Self-Employed

Here are some strategic tips to increase the amount you can borrow and improve approval chances:

  • Increase Your Deposit: A bigger deposit reduces the lender’s risk.

  • Reduce Personal Debt: Pay off loans or credit cards before applying.

  • Stabilise Your Income: Avoid sharp fluctuations in your annual accounts.

  • Leave Profits in the Business: For directors, retained profits may count towards your affordability.

  • Use an Accountant: Mortgage lenders value professionally prepared accounts.

  • Register for the Electoral Roll: It boosts your credit profile.

  • Avoid Major Purchases: Don’t take on new debt before your mortgage is approved.


Frequently Asked Questions (FAQs)


1. Can I get a mortgage if I’ve only been self-employed for 1 year? 

Yes, but your options may be limited. Some specialist lenders will consider 1 year’s accounts if your financials are strong and you have a good deposit.


2. Will my business expenses reduce how much I can borrow?

Yes. Lenders usually look at your net income after business expenses, so claiming too many deductions can lower your borrowing capacity.


3. Do I need a higher deposit if I’m self-employed? 

Not necessarily, but having a deposit of 15–20% will improve your chances, especially if your income varies or you’ve only been trading for a short time.


Get Started with ApeFinance

Navigating a mortgage as a self-employed professional doesn’t need to be overwhelming. At ApeFinance, we offer tailored self-employed mortgage advice to help freelancers, contractors, and business owners secure competitive mortgage deals. Whether you’re just getting started or already trading successfully, we’ll guide you every step of the way.


Get in touch with ApeFinance today to explore your options and take the first step towards owning your dream home.


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