How Long Do You Have to Be Self-Employed to Get a Mortgage?

Just become self-employed and looking to buy a home? You might’ve heard getting a mortgage could be tricky. Truth is, it can be different—but that doesn’t necessarily mean difficult. With the right know-how and a little forward planning, getting a mortgage while newly self-employed is completely achievable.

At Picnic, we believe modern life doesn’t always follow one path, and neither should mortgages. Whether you’ve got one year under your belt or you're just getting started, there’s likely a lender out there who’ll give your application a fair chance of being approved. 

How Long Do You Have to Be Self-Employed? 

Most mortgage lenders prefer to see at least two years' self-employed accounts or tax returns to assess how reliable and consistent your income is. That said, it isn’t a hard-and-fast rule. Some lenders are open to applicants with one year’s accounts, and in certain cases, even less.

Traditional lenders often see self-employed income as less predictable, so proving your financial stability takes a bit more work. Basically, the more history you’ve got, the more choices you’ll have for lenders. 

But don’t rule yourself out if you’re still new to self-employment. The mortgage world is wider than you might think. Having an experienced broker on your side (like us!), one who knows which lenders to speak to and how to present your case in the best light, will definitely help your cause. 

How Will It Affect Your Mortgage Application? 

If you’re new to self-employment, some high-street lenders might be a bit cautious. They want to know that your income is stable and you can afford the repayments, which can be harder to prove when you’ve only just started out. 

Here’s what they’ll usually ask for:

• Your trading history

• SA302 tax calculations and HMRC tax year overviews

• Business bank statements

• Signed contracts or proof of future work

Providing a mortgage lender with as much clarity as possible on your business's future prospects will go a long way in giving them the comfort and confidence they’re looking for.  

With Less than 2 Years’ Accounts? 

Yes, it’s possible to get a mortgage with less than 2 years' accounts. Plenty of lenders are available who will consider applicants with only twelve months of self-employment behind them, especially if:

• You’ve got a strong income trajectory

• You can show regular work or future contracts

• You have a clean credit history

• You can provide a larger deposit (typically 15% or more)

With Less than 1 Year’s Accounts? 

It’s a taller order, but not impossible. If you’re under the one-year mark, most high-street lenders will be out of the running, but if you can provide additional reassurance of your future income, then some specialist lenders will still be available. 

That might come in the form of:

• A previous history in the same industry

• Recent contracts or strong projected income

• Past PAYE income if you were employed until recently

This route will usually require advice from a specialist broker if you’re to navigate through it successfully, but it can be done.

With No Accounts? 

This is extremely rare, but there may be exceptions. If you haven’t filed accounts yet, you would typically need:

• A lucrative long-term contract (common for IT contractors)

• Strong evidence of future income

• A significant deposit (typically 20% or more)

• A background of similar work in an employed role

Only a handful of lenders deal in these types of cases, so you’ll definitely want a broker on your side who knows who they are and how to prepare your application. 

Which Mortgage Lenders Can Help? 

If you’ve only recently become self-employed, you probably won’t find many high street names throwing their doors open to you, but there are specialist lenders who will be much more open to your application. Some of these names include:

• Aldermore

• Kensington Mortgages

• Bluestone Mortgages

• Vida Homeloans

• Pepper Money

Each one has its own criteria, so having someone in your corner to match you with the right lender can make all the difference and save you a lot of time - that’s where we come in! 

How Can You Boost Your Chances? 

There are a few smart moves you can make to strengthen your mortgage application:

• Keep detailed, up-to-date accounts (using a professional accountant if you can). 

• Keep work steady and your bank statements healthy.

• Save for a bigger deposit.

• Make sure all your regular outgoings are paid on time

• Monitor your credit score and make improvements where necessary. 

• Show evidence of stable or increasing income.

• Keep business and personal finances separate.

• Work with a mortgage broker and apply for a mortgage in principle

The more you can prove that your income is stable and reliable, the more likely lenders will say yes.

What Else Could Affect Your Chances? 

Your self-employment status is just one part of the mortgage application. Lenders will also take into account:

• Your credit history

• Your total debt and outgoings

• The size of your deposit

• The type of property you're buying

• Whether you have dependents or other financial commitments

Being recently self-employed is just one piece of the puzzle. Presenting a well-rounded, financially responsible profile is the key to getting approved, and it can make all the difference.