Self-Employed Mortgage with One Years Accounts

Get in touch today to discuss the most suitable mortgage option for you.

Most mortgage lenders are well geared up to take on Self-Employed customers and have a good understanding of how small businesses work.  If you haven’t been in business for long you may have a more restricted choice of lenders, but you should still be able to find a suitable mortgage deal.

Can I get a mortgage if I’ve only been Self-Employed for one year?

Most lenders want to see two or three years’ business records for Self-Employed customers, because your income can vary from year to year. The more business information they can look at, the better they will understand how reliable you will be in repaying the mortgage loan.

That said, some specialist lenders are happy to base their mortgage calculations on just one years’ accounts. 

How do I prove my income with only one years’ accounts?

Proving your income is an important step in your mortgage application, as it’s the basis of how lenders decide how much to offer you.

Usually lenders do this by looking at your company accounts, which should be certified by a qualified accountant. The accounts normally state your turnover, profit/loss, salary and dividends. 

Lenders might also request your self assessment tax return (SA302). As with any financial product, they will also check your credit score. If you have bad credit, it can narrow down your choice of Mortgage Lenders even more, and you may have to pay higher interest rates. 

How does it work for the Self-Employed, Sole Traders and partnerships?

With sole traders and partnerships, lenders will either request 1- 2 years worth of accounts or the details from your tax return. If you’re in a partnership, they will often base your income on your share of annual profits.

If you’ve set up a limited company, the lender often looks at the directors’ salary and dividends stated on your accounts. Meanwhile other lenders will also consider your net profit. This is worth exploring, especially if you pay yourself a nominal salary to keep your tax down – it may mean you can borrow more.

Each lender has their own criteria and approach to Self-Employed borrowers, and it can be well worth seeking advice from a mortgage expert to find the most appropriate deals.

How much can I borrow?

A mortgage provider will usually lend you four to five times your income – this is the same for employed and Self-Employed home-buyers. Make sure you understand how much the monthly repayments will be and that they are affordable, because if you fall behind with payments your home may be repossessed. 

You may also wish to consider mortgage protection products. Many Self-Employed people opt for income protection, which pays you a monthly sum if you are unable to work due to illness or injury. The lack of sick pay is one of the disadvantages of Self-Employment.

What deposit will I need?

Most people aim to save up around 10% of the property value. While you can find mortgage products with just 5% deposit, you will need good credit for these. If you can put down 15% or more towards a home you will get more competitive interest rates and a wider choice of lenders.

Can I get Help to Buy when Self-Employed with one years’ accounts?

The Help to Buy scheme supports First Time Buyers to get on the property ladder. This government-led scheme applies to new build properties.

The scheme helps you buy a home with just a 5% deposit, and tops this up with a loan for a further 20% (or 40% in London boroughs). You take out a mortgage for the remaining 75% of the purchase price, and the loan is interest-free for five years.

Help to Buy is open to the Self-Employed, even if you’ve only got one years’ accounts. Suitable lenders may be limited, however, in which case a Mortgage Broker can help you.

How can a Mortgage Broker help?

We’re professional Financial Advisors who specialise in mortgages, and it’s our job to explore the market on your behalf to find the most suitable deals. We know the lenders that provide mortgages with one years’ accounts, and we work with Self-Employed clients to achieve all kinds of property goals, including First Time Buyers, Buy to Let mortgages and remortgage deals.

The Mortgage Marketplace is authorised and regulated by the Financial Conduct Authority, so contact our registered office today and speak to one of our friendly experts.

Frequently Asked Questions

Call us today on 0800 170 7474 to discuss your borrowing potential and eligiability.

We believe in being competitive and transparent on fees.

Your initial mortgage consultation is free. You won’t be asked to pay a fee until we have submitted an application on your behalf.

Our fees depend on the product – see the list below or speak to an advisor.
Residential Mortgage & Remortgage
Application fee of £395.00 payable on receipt of the lender’s decision in principle and our broker fee of £595.00 payable on receipt of mortgage offer. Total fees payable – £990.00.

Buy-to Let Mortgages & Remortgages
Application fee of £395.00 payable on receipt of the lender’s decision in principle and our broker fee from £595 up to 0.50% of the mortgage offer. For example, loan amount £200,000, broker fee payable could be £1,000.00. Total fees payable £1,395.00. A minimum broker fee of £595.00 will be applied on all buy-to-let applications.

Equity Release Mortgages
Application fee of £395.00 payable on receipt of the lender’s decision in principle and our broker fee of £995.00 payable on completion of your mortgage. Total fees payable – £1,390.00.

Credit Repair Mortgages
Application fee of £395.00 payable on receipt of the lender’s decision in principle and our broker fee equal to 0.5% of the mortgage offer. For example, loan amount £200,000, broker fee payable could be £1,000.00. Total fees payable – £1,395.00. A minimum broker fee of £595.00 will be applied on credit repair applications.

Life Insurance
No fee will be charged by us. You will receive a free quotation from the policy provider.

Typically, the mortgage process will take 2-6 weeks to reach approval.

A mortgage offer is usually valid for 6 months.

Please be aware, the process is currently taking longer due to Covid-19. Please see question ‘How has Covid-19 affected the mortgage market?’.

Whilst you are not required to take out a life cover, our job is to ensure your mortgage is affordable, no matter what. It may not be nice to talk about, but if something were to happen to you, you want to know your family and investment are safe.

We will advise on all the options available and provide a no obligation quote from our partner provider, Royal London.

You may need a solicitor, depending on the circumstance. Your adviser will discuss this with you, and should you need one we can put you in touch with our trusted partners, or you can use you own.