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Self Employed Mortgages F.A.Q’s

Our most frequently asked self employed mortgage questions

How many years trading figures do I need?

To satisfy all lenders you will need three years trading figures. Many lenders work on two years figures. A few will work on a single year’s figures.

What do mortgage lenders consider as my income?

This depends on your trading style.For sole traders lenders consider profit before tax but after business expenses (not turnover)For Partnerships lenders consider your share of Partnership profit

For mortgages for limited company directors, most lenders consider PAYE and dividends only. Some will consider your share of business profit whether or not you have taken it as dividend.

What if my profit has dropped?

Most mortgage lenders average two or three years income in order to decide a figure on which to base your lending. If your profit has dropped lenders will usually work on the most recent year’s figures.

Do lenders offer less to self-employed applicants?

In general no, but there are some lenders that are more aggressive in their affordability calculations for the self-employed.

Do lenders make any exceptions?

Certain Professional applicants such as Doctors can sometimes obtain lending within their first year of trading. We do these cases regularly and each case is handled on its own merits.

Will mortgage lenders work on business projections?

There are mortgage lender’s that will consider business projections for a new and growing business.

I have been told my shareholding low is too to consider my profit – is this right?

Provided you hold at least 20% of the business some Lenders will work on profit rather than dividend.

I have been told to provide SA302s – how do I obtain these?

SA302s are available from HMRC – click here for details on how to obtain SA302’s

We run a Limited Liability Partnership – how are we assessed?

As a member in an LLP your income is taxed as a Partnership. Lenders will therefore want to see up to three years SA302s.