Getting a mortgage when you're self-employed is absolutely possible — but lenders assess your income differently. Our FCA-regulated specialist brokers know exactly which lenders take the most flexible view of self-employed income, and how to present your application for the best chance of approval.
Lenders assess self-employed income very differently depending on your trading structure. Getting this right is critical to your application succeeding.
Lenders use your net profit (after expenses) from your SA302 tax returns. Most require 2–3 years of accounts and use the lower of the last two years' profit or an average.
Most lenders assess salary plus dividends. Some will also consider retained profits within the company, which can significantly increase your borrowing power.
Day-rate contractors are often assessed on their daily or hourly rate × annualised working days — rather than net profit. This can significantly increase borrowing capacity vs standard self-employed treatment.
Freelancers with variable monthly income need a broker who knows which lenders take a flexible, common-sense view of income history rather than a rigid 3-year average.
Most high-street lenders want 2–3 years of accounts. However, select specialist lenders will consider applications with just 12 months' trading history if your income is strong and consistent.
If your income is growing year-on-year, some lenders will use the most recent year's figure rather than an average — maximising your borrowing power. A broker knows exactly which lenders do this.
Having the right paperwork ready speeds up your application significantly. Your broker will tell you exactly what's needed, but here's a typical checklist:
📌 Important: Using an accountant who is a member of a recognised body (ICAEW, ACCA, CIMA) strengthens your application. Some lenders will not accept accounts prepared by unqualified accountants.
| Self-Employed | Employed | |
|---|---|---|
| Income evidence | SA302 / accounts | 3 months' payslips + P60 |
| Years of history needed | 2–3 years (some 1 yr) | Usually 3 months |
| Lenders available | Specialist selection | All lenders |
| Income assessed | Net profit / salary + divs | Gross salary + bonus |
| Application complexity | Higher | Standard |
| Broker importance | Critical | Helpful |
Borrowing capacity depends heavily on how your income is presented. The right broker can make a significant difference.
| Net Profit / Income Used | 4× Borrowing | 4.5× Borrowing | 5× Borrowing (specialist) |
|---|---|---|---|
| £30,000 | £120,000 | £135,000 | £150,000 |
| £40,000 | £160,000 | £180,000 | £200,000 |
| £60,000 | £240,000 | £270,000 | £300,000 |
| £80,000 | £320,000 | £360,000 | £400,000 |
| £100,000 | £400,000 | £450,000 | £500,000 |
Actual borrowing depends on outgoings, credit score, deposit size, and lender criteria. A broker will calculate your realistic maximum across multiple lenders.
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