Self Employed Mortgage

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Self-Employed Mortgages – A Guide 

What is a Self-Employed mortgage?

There is no such thing as a Self-Employed mortgage – if you are Self-Employed, you have access to the same mortgages as everyone else. There are mortgage lenders out there who tailor their mortgage products towards specific audiences such as the Self-Employed. These specialist lenders can be hard to find and it could be worth seeking help from a Mortgage Broker.

As a borrower who is Self-Employed, mortgage applications differ when it comes to proving your income from PAYE employed people. Lenders are becoming more and more flexible towards the Self-Employed and there are a number of products out there for you.

How will your Self-Employed application be assessed?

No matter your employment status you will need to prove your income and you will go through a credit check. Lenders look into your income through bank statements to see how much they are willing to loan to you and to ensure you are on a stable income. They also look into your credit history to ensure that you are reliable when it comes to borrowing money.

If you are Self-Employed you will need to provide at least two years’ worth of accounts to prove that you have been accounting for your taxes appropriately.

Sole Trader

If you prefer to work as a solo artist, then you will need to provide any contracts or accounts that you have had from the past two years alongside your wage slips. You will need to ensure you have properly filed all of your SA302 forms.

Partnership

If you are in a partnership then you will need to prove your share of the company as well as your income in the same way as a sole trader. If you have any retained profits within the company these may or may not be taken into account depending on your chosen lender.

Limited Company

If you are a Limited Company then you need to provide the Director’s salary and dividends that are tied up in the company.

It is important to look into what the lender requires from you before making your application. Every lender is different and will take different things into account and you need to find the right mortgage product for you.

How much can I borrow for a mortgage if I am Self-Employed?

You can borrow up to five times your annual salary depending on your credit score and current financial status.

If you have bad credit or no credit then you may require a specialist lender. There are lenders who cater to bad credit borrowers but you will not be getting the lowest rates available if you are considered a high-risk borrower.

You need to make sure you can afford the mortgage repayments you are committing to. If you do not plan and budget before applying for a mortgage and fall behind in your repayments – your home may be repossessed. 

How much of a deposit will I need for a mortgage?

Gather at least 10% of the property’s value as a deposit, but the bigger the deposit the better, especially when you are self-employed. If you happen to be a First Time Buyer then you access a range of schemes to help you onto the property ladder which usually requires a deposit as small as 5%.

Speak To An Expert

Total Home Loans are a national mortgage broker with whole of market access. Their combined experience of over 50 years in the mortgage and financial services industry means they have an enviable reputation and one which makes them well-placed to find the most suitable mortgage solution for you.

How do you improve your chances of being accepted by a lender if you are Self-Employed?

There are a few things that you can do to boost your chances of hearing a “yes” from your chosen lender. The way in which you approach a lender is crucial and you need to ensure you have budgeted and planned beforehand to check you can afford the mortgage you are applying for.

Make sure you have a good credit rating

Credit ratings are pretty important when it comes to lenders, they want to make sure you can handle borrowing money and that you give it back. If you have any debts it is best to clear them before applying. Make sure you are registered on the Electoral Roll and all of your accounts are up to date.

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Disclaimer

Apply at the right time

When it comes to the right mortgage product, sometimes it is worth the wait – If you have not been trading long and cannot provide two years’ worth of accounts you may have to dig deeper to find a lender.

If you have outstanding debts to pay then try to get these paid off before going to a lender, they will be able to see you have paid them off too. It shows more willingness and more reliability with money.

How can a Mortgage Broker help?

A Mortgage Broker can help you with everything to do with mortgages. They will aid you in gathering everything you need alongside your mortgage application and guide you to the right products depending on your situation.

Here at Total Home Loans, we are Whole of Market Mortgage Adviser and have access to products not available on the high street and exclusive deals through our Network Quilter Financial Planning Ltd

If you are Self-Employed you may be better off with a specialist lender which we can help you find. It doesn’t matter whether you are looking for a mortgage that doesn’t charge you for overpaying on your mortgage each month or a Buy to Let mortgage, we can help find the right mortgage for you.

Some buy to let mortgages are not regulated by the Financial Conduct Authority.

Kevin Franklin

May 31, 2022

Stars

Very professional company. I’m 63 Years old and was having trouble sorting any kind of mortgage but Mark from Total Home Loans saved the day. please do not hesitate to contact them first as I wasted a lot of time hunting around for others.

Well done Mark and the team, the number 1 company.

Lolita Cooksley

May 16, 2022

Stars

Very professional fast efficient service and really caring and genuine people to deal with. They have helped us with our mortgage twice and been great both times.

We wouldn’t hesitate to use them again in future.

Karin Salmons

May 16, 2022

Stars

Thanks to Total Home Loans and their patience, care and understanding, along with their skill and kindness, my partner and myself are now home owners something I never thought would happen,

Please even if you think it’s not something you can achieve give Total Home Loans a call they will work for you.

Again thank you all at Total Homes Loans.

Arfan Ramzan

May 5, 2022

Stars

Great service, I tried so many brokers but no one could help but Total Home Loans were the only ones who found me a lender. It was really hard to find someone, I went to 8 brokers all found online with there so called promising words trying to bring customers in still no good for me but Total Home Loans got the job done, excellent service, will recommend 💯💯💯 and there was no fee till all applications was complete unlike some brokers.

Steve Greenfield

May 4, 2022

Stars

Very happy with my experience with Total Home Loans. Very professional company, were always quick to reply and action whatever was needed.

Will definitely be back! I’ve already recommended them to a friend and they had the same positive experience that I had.

Why Total Home Loans?

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