Self-employed Mortgages
Are you self-employed and not sure where to start getting a mortgage? Often, being self-employed can cause concerns on whether your application will be accepted, or whether you’ll be paying much more than if you were employed.
Your home may be repossessed if you do not keep up repayments on your Mortgage
Sadly there’s no such thing as a ‘self-employed mortgage’. You’ll need to apply for a normal mortgage, but you just have to jump through more hoops to prove your income than someone who is on a company payroll.
As you don’t have official payslips, you’ll need to gather a range of other documents, so lenders can be certain of your income and your ability to repay any loan in the future.
So what do I need?
Of course, it can vary depending on your circumstances, but generally you’ll need;
- At least 2 years of certified accounts – don’t panic if you don’t have them just yet
- A tax calculation (SA302) form or a tax year overview (from HMRC) for the past 2 or 3 years
- Any record of upcoming contracts – if you’re a contractor
- All records of dividend payments and salary – if you’re a company director
- You’ll also need all the usual documents for your application.
Luckily for you, we have personal experience in this area, so our knowledge comes in handy to help guide you through and make sure we find the right mortgage for you and your family.
How it works...
1. You'll tell us your goals & aspirations
2. You'll gather your documents and let us know your requirements
3. You'll receive our recommendations
4. You'll let us know you'd like to go ahead and we'll submit your application
Common FAQS
As a sole trader, as well as all the other paperwork, you will need to ensure you have a minimum of one year’s finalised accounts or an SA302 from HMRC that is dated less than 18 months old. (This can be requested once you’ve completed and filed your self assessment.)
If you’re a contractor or freelancer, working through a limited company, you’ll need your current contract and, in some cases, the past 12 months. If this is not possible we can look at using your personal tax returns or company accounts.
Limited company directors, you will need to provide your latest year’s company accounts or personal Self Assessment tax return as a minimum. Some lenders will require two or three years’ accounts but there are still plenty of options with only one year’s accounts.
It can be more of challenge to get a mortgage if you are self-employed. This is because you need to prove you have a reliable income. Normally, this will just mean jumping through a few extra hoops, however we will guide you through this process to make it as easy and simple as possible.
Being self employed does not change the amount you can borrow. The only difference is how we evidence your income to the mortgage lender to show reliability.
We can include all income streams to help your affordability. Different streams of income require different evidence however this can be discussed on a case by case basis.
Getting an accountant prior to applying for a mortgage is not a requirement, however an accountant can easily obtain certain documents that a mortgage lender would require to see from your business. Be aware though some mortgage companies will only accept documents drawn up and approved by a chartered accountant.
A fee of £350 is payable on Mortgage application.
Are you looking for a different question? Check out our FAQ page here.