Can you get a mortgage when self-employed?

Yes, you can get a mortgage when self-employed. Being self-employed does not automatically stop you from getting a mortgage, but lenders usually need to see clear evidence of your income, affordability and how sustainable your earnings are.

That means your application may be assessed slightly differently from someone in standard employment. Instead of relying only on payslips, lenders may look at accounts, tax calculations, bank statements, company income or contracts, depending on how your business is set up.

For many people asking whether you can get a mortgage when self-employed, the answer is yes, but how straightforward it feels can depend on your trading history, deposit, credit history, income stability and lender choice.

Can you get a mortgage when self-employed?

You can get a mortgage if you’re self-employed, as long as a lender is comfortable that the mortgage is affordable and your income can be evidenced.

The key point is that lenders usually want to understand:

• How long you’ve been self-employed
• How much you earn
• Whether your income is stable
• How your income is taken from the business
• What deposit you have
• Whether your credit history supports the application
• Whether you have debts, dependants or regular commitments

A self-employed mortgage is not a separate type of mortgage. It usually means a normal residential mortgage where your income comes from self-employment rather than employment.

What counts as self-employed for a mortgage?

For mortgage purposes, self-employed applicants can include several types of workers and business owners.

You may be treated as self-employed if you are a:

• Sole trader
• Limited company director
• Contractor
• Freelancer
• Partner in a business or partnership

How your income is assessed can depend on your structure. A sole trader may be assessed using net profit. A company director may be assessed using salary and dividends, or sometimes other business figures depending on the lender.

For example, if you run your own limited company and take a small salary plus dividends, a lender may look at your income differently from a freelancer who reports annual self-employed profit through self assessment. If this applies to you, a more specific limited company director mortgage guide may be useful later.

How long do you need to be self-employed to get a mortgage?

Many lenders prefer to see at least two years of self-employed income evidence. This helps them understand whether your earnings are consistent rather than based on one unusually strong year.

However, two years is not always a fixed rule across every lender. Some people may still have options with one year’s accounts, especially if the rest of the application is strong.

That could include:

• A good deposit
• Clean credit history
• Strong previous experience in the same industry
• Stable or growing income
• Low debts and commitments
• Clear evidence of ongoing work

For example, a contractor with one year’s accounts and several years of previous employment in the same sector may be viewed differently from someone who has only recently started a completely new business.

How income evidence affects your application

When you apply for a mortgage when self-employed, lenders usually focus on provable income rather than headline turnover.

For example, if you’re a sole trader, your turnover may look high, but lenders are more likely to focus on profit after business expenses. If you’re a company director, they may look at salary, dividends or other business figures depending on the lender’s criteria.

Common types of income evidence can include:

• Finalised accounts
• SA302 tax calculations
• Tax year overviews
• Business bank statements
• Personal bank statements
• Contracts or evidence of ongoing work

This does not mean every lender asks for the same documents in every case. The aim is usually to check that your income is real, evidenced and likely to continue.

For example, a sole trader with two years of steady net profit may have a simpler application than someone with large income swings or unclear business records. If you’re not sure what you may need, it can help to check the documents you need for a self-employed mortgage before applying.

Does your deposit size matter?

Your deposit can make a difference to self-employed mortgage eligibility, but it is only one part of the application.

A larger deposit may reduce the lender’s risk and could increase the number of options available. However, it does not replace the need for clear income evidence. A lender still needs to be comfortable that the mortgage is affordable.

Self-employed applicants do not automatically need a bigger deposit just because they’re self-employed. But if your income is more complex, your trading history is shorter or your credit history is not perfect, a stronger deposit may help the overall case if you’re self-employed.

For example, someone with a 15% deposit, steady income and clean credit may have more options than someone with a smaller deposit and unclear income evidence.

How credit history affects self-employed mortgage eligibility

Credit history still matters when you’re self-employed.

A good credit history can support your application because it shows lenders you’ve managed borrowing responsibly. Missed payments, defaults, county court judgments or high levels of debt may reduce the number of lenders available.

This does not always mean you cannot get a mortgage. It means lender choice and the wider details of your application may become more important.

Lenders may also look at your regular commitments, such as loans, credit cards, car finance, childcare costs and dependants. These can affect affordability because they reduce the amount of income available for mortgage repayments.

What if your income has gone up or down recently?

Lenders usually want to know that your income is sustainable, not just high in one month or one year.

If your profits have increased, that can be positive, but a lender may still want to understand whether the increase is likely to continue. If your profits have dropped, the lender may focus more heavily on the latest year or ask for context around the change.

For example, if your latest-year profit has fallen because of a one-off expense, that may need explaining. If profits have fallen because the business is receiving less work, that could affect affordability.

Different lenders may treat changing income differently, which is knowing how lenders calculate self-employed income can matter so much.

One-year accounts vs two-year accounts

Having two years of accounts can make a self-employed mortgage application easier to assess because the lender has more evidence to work with.

With two years, lenders can compare income over time and see whether it has stayed stable, grown or declined. With one year, there is less history, so the lender may look more carefully at the rest of the case.

That does not mean one year is impossible. It means the application may depend more on the lender, your deposit, your credit history, your business type and your previous experience.

For example, a freelancer with two years of consistent profit may have a more straightforward case than a newly self-employed applicant with only one tax year completed. But someone with only one year of self-employed accounts and strong wider evidence may still have options.

How to check how much you might be able to borrow

Once you know that getting a mortgage when self-employed is possible, the next question is usually how much you might be able to borrow.

Your borrowing amount can depend on:

• Your self-employed income
• Your deposit
• Your regular debts and commitments
• Your dependants
• Your credit history
• The lender’s affordability rules
• How your income is evidenced

A calculator cannot guarantee what a lender will offer, but it can give you a useful rough starting point.

If you want to estimate what may be possible, use our self-employed mortgage calculator to get an idea of how much you could borrow when self-employed based on your income and deposit.

When to get mortgage advice

Mortgage advice can be helpful if your income is not straightforward, you have a short trading history or you’re unsure which lenders may consider your situation.

This can be especially useful if you:

• Have one year’s accounts
• Are a limited company director
• Have recently changed from employed to self-employed
• Have income that has gone up or down
• Take salary and dividends
• Have retained profits in the business
• Work as a contractor or freelancer
• Have credit issues or existing debts

A broker can help you understand which lenders may be more suitable, what income evidence may be needed and whether your application is likely to fit before you apply.

If your situation is more complex, Monday Mortgages can help you understand your self-employed mortgage options before you approach lenders.