Many lenders offer mortgages to self-employed people, although the range of options available can depend on your income history and how your business is structured. There may be a few deals you don’t qualify for, but the main difference is you’ll need a bit more prep to show lenders you’ll be able to make your mortgage payments.
Yes, you absolutely can. Being self-employed doesn’t lock you out of normal mortgages.
In mortgage terms, you’re classed as self-employed if you own 20–25% or more of a business you earn your main income from, though this can vary depending on the lender.
There’s no such thing as a “self-employed mortgage”. You’re applying for the same mortgages as employed people. The difference is how lenders assess your income. You won’t just hand over a few payslips and call it a day. Lenders usually want to see at least two years’ worth of accounts.
They want proof your income is:
Once you understand what they’re looking for (and choose the right lender), it’s more doable.
Lenders don’t all take the same approach. This highlights the importance of speaking to a broker, like Habito, when making a self-employed mortgage application, as we can compare lenders across the market to see which is likely to look at your individual income type the most favourably.
Your home may be repossessed if you do not keep up repayments on your mortgage.
Habito is a mortgage broker, not a lender. We’re authorised and regulated by the Financial Conduct Authority. This content is intended for general guidance and is not a substitute for personalised mortgage advice.
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Mortgage lenders generally consider you self employed if you own 20-25% or more of the business you work for.
Lenders don’t treat all self-employed applicants the same. The structure you trade under matters — especially when it comes to income calculations.
Some lenders will use your standard day rate, multiplied by the number of days you work each year to figure out your average annual income. You normally need to show you have a year’s contract, at least, to use this approach.
Here’s an example for someone earning £400 a day, working 5 days a week for 46 weeks of the year.
Gaps between contracts are pretty normal. Most contractor-friendly lenders allow:
Find out more in our guide for freelancers.
For sole traders, it’s refreshingly simple: net profit is king. Lenders focus on the net profit shown on your SA302s for 2-3 years. If your profits are:
With partnerships, lenders assess your individual share of net profits — not the whole business.
So if the business makes £120,000 in net profit for two years in a row, but your share is 40%, lenders treat your yearly income as £48,000.
As well as producing all the usual documents to support your mortgage application, you’ll have to show lenders more about your business and personal finances:
In most cases, you’ll also need to have the statements certified by an accountant.
The lender choice matters a lot. Lenders most commonly look at your salary plus dividends. Some will look at your share of the company’s net profit.
Talking with a broker like Habito can help you navigate the system and find a lender that’s a good fit for your finances.
Find out more in our guide to company director mortgages
Some people search for loans when what they really need is funding to buy a property.
If you’re buying property to live in, you need a mortgage.
If you need cash for equipment or cash flow, you need a business loan.
These days, all mortgages need some sort of evidence that you can afford to repay them. If you come across the “no doc” mortgage, it’s a myth. These self-certified mortgages were banned in the UK in 2014. But not all lenders require the same documentation.
Mortgage lenders typically want to see bank statements for 3-6 months as part of a mortgage application, so they can verify your income and your spending.
If you have complex income sources, there are specialist lenders who can do a flexible income assessment for non-standard earnings.
Lenders see self-employed income as a higher risk, so their checks are stricter. In addition to the typical documents everyone has to submit in their mortgage application, lenders might want:
They might also want to see cash reserves, if you’re a contractor.
Lenders want to see you have a stable income. So if yours fluctuates, they can be more cautious with their lending. They will usually want to see that income is fairly steady or growing, year on year.
Lenders differ in how they determine your annual income. Some may want just the most recent tax year. Others want an average of the last 2-3 years.
You might hear about the “2-year rule” and it’s mostly true: 2 years of accounts or tax returns will typically give you a wider choice of lenders.
Some lenders may consider applications with one year of accounts in certain professions, but this is less common and criteria can be stricter.
If you’re newly self-employed – you have less than 12 months of self-employment income – and want a mortgage, you may need to approach specialist lenders. These mortgages can come with higher interest rates and fees, and approval is not guaranteed.
If your income has dropped, it’s likely that lenders will only be willing to base your loan on the lowest annual income.
Most lenders will also consider the reasons for a dip in earnings if you can offer an explanation. For example, maybe you invested in new equipment, which lowered your profits for that year.
To prove your income, you’ll need
Lenders will look for consistency between your declared income and bank statements. They’ll also look for stability, trends and a healthy business.
See more in our guide to proving income when you’re self-employed.
Most lenders cap borrowing at around 4.5x your income, although some stretch to more if there’s a strong case.
But if you’re self-employed, you’ll generally be at the conservative end.
Here’s an example: £70,000 income
All figures and examples are for illustration only. The amount you can borrow and the rate you’re offered will depend on your individual circumstances and lender criteria.
Your actual figure depends on many factors, including:
Use our mortgage calculator to see what you might borrow
You might have come across various budgeting “rules” that are ways to ensure you have enough to cover your mortgage payment each month.
The 50/30/20 rule. This advises you to spend 50% of your income on needs (such as your mortgage); 30% on wants and 20% on topping up your savings or paying off debt like credit cards.
The 70/20/10 rule. Some people see this as more realistic. It suggests 70% for needs, 20% for wants, and 10% for savings or debt.
The 40/30/20/10 rule. This gives 40% to needs, 30% to wants, 20% to savings, and 10% to paying off any loans or credit card debt.
When mortgage lenders are considering your application, they typically stress test what you can afford. What if interest rates were 2-3% above the deal you’re on? Could you still afford the monthly repayments? How much cash do you have to spare each month after your other commitments?
The main red flags for lenders are signs that you’re not a responsible borrower. So if you don’t have a good track record of repaying debts or managing your money well, that’s going to cause issues.
Red flags in money management include:
Red flags on income include:
Quick wins that will help:
Lenders assess your income in different ways, so it really helps to get support from an expert who can help you navigate the market before you apply. A broker like Habito can help to determine the most suitable lender for your individual finances.
Your home may be repossessed if you do not keep up repayments on your mortgage.
This content is intended for general guidance and is not a substitute for personalised mortgage advice.
Generally, yes – you need to work a bit harder to prove to lenders your income is stable enough to afford your mortgage payment each month. But if you follow our guide and get all your paperwork in place, you’ll boost your chances of being approved.
People applying for self-certification mortgages were able to certify their income without having to prove it with accounts or payslips. They were banned in the UK in 2014.
Not necessarily. Self-employed people are applying for the same deals as others. But if you have an unstable income, or a low deposit, the lender is taking on more risk and so rates would be higher to reflect that.
Yes, there’s no reason you can’t do this, but the self-employed worker would need to prove their income in the ways we’ve explained in this guide.
Last updated: 25/02/2026
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