Documents Needed for a Self-Employed

Obtaining a mortgage can be more challenging if you are self-employed because of needing a reliable income that can be proven – here’s the documentation you’ll need.

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Documents Needed for a Self-Employed Mortgage

There is no specific mortgage out there for the self-employed people. As someone who is self-employed you can access all of the same mortgage products as a PAYE employee. The difference is in how you have to prove your income.

It can be more of a challenge to obtain a mortgage if you are self-employed due to having to ensure you have a reliable income that can be proven. There are plenty of mortgage lenders out there who are becoming more flexible towards the self-employed.

What Documentation will I need?

When you apply for a mortgage you will need to provide the standard things such as:

  • Passport
  • Driving License
  • Council Tax Bill
  • Utility bills within the past three months
  • Bank statements.

As someone who is self employed gather the following too:

  • Two or more years of accounts
  • Self assessment and tax returns – SA302 forms from the past two to three years
  • Evidence of upcoming contracts (if applicable)
  • Statements of dividend payments or retained profits (if applicable).

Mortgage lenders sometimes require for you to provide your accounts to have been prepared by a registered and chartered accountant. You should ensure to check the criteria of what your lender requires as every lender is different.

How Will I be Assessed?

There are generally three types of self-employed out there and they fall into sole traders, partners and Limited Companies. Each different category has different ways of being assessed by mortgage lenders.

Sole Trader

If you are a sole trader you will need to declare your income through self-assesment forms and your SA302 forms.

Partnership

If you are part of a partnership you will need to show your indvidual share of the profits.

Limited Company

As a Limited Company you will need to provide your salary and any dividends that you have in your company. You will need at least two to three years of accounts or will require a specialist lender.

How do you Improve your Chances of being Approved By a Lender?

Make sure that you have a good credit score by checking your credit rating on websites such as Experian. As a self-employed person it is important to make sure you have your finances together before approaching a lender.

The bigger the deposit that you can provide the better. If you can give more money up front lenders are likely to give you lower rates on your mortgage. A bigger deposit can save you more money in the long term.

Make sure that you have all your documents prepared and you can afford the mortgage you are applying for. Lenders will require credit checks and too many can damage your score.

How can a Mortgage Broker help if you Prepare Documents if you are Self-Employed?

Mortgage advisers focus on helping you into the property you long for whilst ensuring you are committing to something you can afford. They can help find you the right products for your situation with no hassle and fuss.

Brokers know what documentation is required alongside your mortgage application and can ensure that you are completely prepared when approaching a lender. Knowing the mortgage market takes time and why stress when you can approach an adviser who is willing to help you every step of the way.

Brokers know self employed workers and know the lenders that are right for you.They will make sure you understand your commitments every step of the way. Advisers are authorised and regulated by the Financial Conduct Authority and are qualified to give you the assistance you need.

Why One Mortgages, Protection and Estates?

Call us now on 0113 208 3308

to find out more or arrange a consultation.

Based in Leeds, One Mortgages & Protection Limited offers impartial and unbiased advice to customers UK wide, no customer is too far away to help.