Being self-employed does not make a mortgage harder to get. It makes it harder to get from the wrong lender. The trick is knowing how each one reads your figures before you apply.
What counts as income
Sole traders are assessed on net profit. Limited company directors are assessed on salary plus dividends, or, with some lenders, salary plus their share of retained profit. That second method can make a large difference if you leave money in the business.
Two years, or one
Most lenders want two years of accounts or tax calculations and take an average, or the latest year if it is lower. A smaller number will lend on one year's figures, and a few will look at contractors on a day rate. If your latest year is much better than the one before, we go to the lenders that use the latest year.
Paperwork to gather now
Tax calculations and tax year overviews from HMRC, full accounts if you have a company, three months of business and personal bank statements, and a note of any bounce-back or other business loans. Having it ready shortens the whole process by weeks.
Turned down before?
A decline from one lender is not a verdict. It is usually a mismatch between how you are paid and how that lender counts it. Tell us who said no and why, and we will tell you who is likely to say yes.
