Being self-employed comes with plenty of benefits—flexibility, control, and the chance to build something of your own. But when it comes to getting a mortgage, it can sometimes feel like the odds are stacked against you.
The good news? It’s absolutely possible to secure a mortgage when you work for yourself. You just need to know how to present your finances in the right way.
In this guide, we’ll walk you through everything you need to know—from what lenders look for to the documents you’ll need and how to improve your chances of approval. Whether you're a freelancer, contractor, sole trader, or limited company director, we’ll help you navigate the process with confidence.
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How Do Lenders View Self-Employed Applicants?
If you’re self-employed, lenders assess you slightly differently than they would someone in a full-time job. Instead of looking at a regular payslip, they’ll want to see a steady history of earnings to make sure you can afford the mortgage.
Most lenders will ask for at least two years of trading history, though some specialist lenders will consider applications with just one year’s accounts. The key thing they’re looking for is consistency and reliability in your income.
Here’s what they’ll typically check:
• Your net profit (if you’re a sole trader or in a partnership)
• Your salary + dividends (if you’re a limited company director)
• Your contract rates (if you’re a freelancer or contractor)
• Your credit history and overall financial health
While the process can feel stricter than for salaried employees, the right preparation can make it much smoother.
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Step 1: Gather the Right Documents
One of the best ways to improve your chances of mortgage approval is to have your paperwork in order. Here’s what you’ll need:
Proof of Income
Lenders will usually want to see:
• SA302 forms and tax overviews from the past two or three years (available from HMRC)
• Business accounts, ideally prepared by a certified accountant
• Bank statements (personal and business) from the last three to six months
If you’re a contractor or freelancer, some lenders may also accept proof of ongoing contracts or regular invoices to demonstrate steady income.
Credit Report
Your credit score plays a huge role in mortgage approvals. Check your credit report before applying to make sure there are no errors or red flags. Simple steps like registering on the electoral roll and paying off outstanding debts can help boost your score.
Proof of Deposit
As with any mortgage, you’ll need to show where your deposit is coming from. This could be from savings, investments, or even a gifted deposit from a family member.
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Step 2: Work Out How Much You Can Borrow
Lenders will assess how much you can afford based on your average income over the last two or three years.
Most will offer around four to five times your annual income, but this varies depending on your overall financial situation. A higher deposit can also work in your favour, reducing the lender’s risk and improving your mortgage options.
To get an idea of what you might be able to borrow, use a self-employed mortgage calculator or speak to one of our team who can give you a more accurate assessment.
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Step 3: Choosing the Right Mortgage
There are plenty of mortgage options out there, and picking the right one will depend on your circumstances. Here’s a quick breakdown of the main types:
Fixed vs Variable Rate Mortgages
• Fixed-rate mortgages give you certainty, as your payments stay the same for a set period (e.g., 2–5 years).
• Variable-rate mortgages (including tracker and discount mortgages) can be lower initially but may fluctuate depending on interest rates.
If your income varies from month to month, a fixed-rate mortgage might be a safer choice, as it keeps your repayments predictable.
Repayment vs Interest-Only Mortgages
• Repayment mortgages gradually reduce the loan balance, meaning you’ll fully own the property by the end of the term.
• Interest-only mortgages have lower monthly payments, but you’ll need a plan to pay off the loan at the end of the term.
Most self-employed applicants go for a repayment mortgage, as lenders are generally more cautious with interest-only loans.
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Step 4: Apply with Confidence
Once you’ve got everything in order, it’s time to apply. Here’s how to improve your chances:
✔ Work with a Specialist Broker – A mortgage broker who understands self-employed applications can find lenders who are more flexible with self-employed incomes.
✔ Improve Your Credit Score – Pay off outstanding debts, avoid late payments, and check your credit report for errors.
✔ Save a Larger Deposit – A bigger deposit reduces the risk for lenders and can get you better mortgage rates.
✔ Show Stability – Lenders prefer steady, reliable income. If possible, avoid big expenses in the months leading up to your application.
✔ Keep Business and Personal Finances Separate – A clear, well-managed business account makes your income easier for lenders to assess.
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Final Thoughts:
Yes, getting a mortgage when you’re self-employed can feel more complicated—but with the right preparation, it’s totally doable. Thousands of self-employed people secure mortgages every year, and you can too.
At Chetwood Lloyd Mortgages, we specialise in helping self-employed professionals navigate the mortgage market with ease. Whether you're a freelancer, contractor, or business owner, we’re here to find the right deal for you.
💬 Want to chat about your options? Get in touch today—we’re happy to help!
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