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If you’re self-employed and thinking about buying a home, you’ve probably heard that getting a mortgage is “impossible” or “way harder than for everyone else.” The truth? It’s not as difficult as people make it out to be—especially when you have the right guidance.
At Verve Financial, we’ve helped countless self-employed people secure mortgages, and we’re here to bust the myths and give you the facts. In this blog, we’ll explain how mortgages work for the self-employed, what lenders really look for, and how to improve your chances of getting approved.
What Does “Self-Employed” Mean for Mortgage Applications?
First, let’s define “self-employed” in mortgage terms. You’re considered self-employed if you own more than 20–25% of a business, work as a sole trader, contractor, freelancer, or run your own company.
Lenders don’t see being self-employed as a negative, but they approach your income differently. Instead of looking at a regular payslip, they’ll assess your income based on tax returns, accounts, or business performance.
Why Getting a Mortgage When Self-Employed Isn’t as Hard as You Think
Here’s the good news: lenders don’t discriminate against self-employed applicants. They just need the right paperwork to assess your affordability. Here’s why it’s not as daunting as it seems:
1. Plenty of Options
More lenders than ever are offering mortgages tailored to self-employed people. Whether you’re a freelancer, contractor, or company director, there’s a deal out there for you.
Specialist lenders cater specifically to self-employed borrowers with complex income streams.
2. Income Is What Matters
Lenders care about your income, not your job title. If you can show consistent earnings and prove you can afford the repayments, you’re in the same position as anyone else.
3. Flexibility with Documentation
Lenders now understand that self-employed income can look different. Many accept a combination of income sources, such as dividends, retained profits, or a contractor’s day rate, to calculate affordability.
What Do Lenders Look for When You’re Self-Employed?
To approve your mortgage, lenders will typically want to see:
1. Proof of Income
Most lenders require 1–2 years of accounts prepared by a certified accountant.
If you’re a sole trader, they’ll look at your SA302 forms or tax year overviews.
Contractors may need to provide contracts showing their day rate or projected earnings.
2. Consistency
Lenders prefer steady, predictable income. If your earnings fluctuate, be prepared to explain why and show that your overall income is reliable.
3. A Good Credit History
Your credit score is just as important as your income. Paying bills on time, avoiding debt, and registering on the electoral roll can boost your score.
4. A Reasonable Deposit
While some lenders offer mortgages with just a 5% deposit, having 10–20% saved can make you a more attractive applicant.
How to Boost Your Chances of Getting a Mortgage
If you’re self-employed, here’s how to make your mortgage application stand out:
1. Get Your Paperwork in Order
Keep your accounts up to date and ensure they’re prepared by a qualified accountant.
Have at least 1–2 years of accounts or tax returns ready to show your income history.
2. Save a Bigger Deposit
The more deposit you can save, the better. A larger deposit reduces the lender’s risk and can secure you a better interest rate.
3. Work with a Specialist Mortgage Broker
A broker like Verve Financial can match you with lenders that understand self-employed applicants. We know which lenders are flexible and how to package your application for success.
4. Improve Your Credit Score
Check your credit score before applying, and address any issues, such as missed payments or errors on your credit report.
5. Reduce Debt
Pay off as much debt as possible before applying for a mortgage. Lenders assess your debt-to-income ratio to determine affordability.
