Self-Employed Mortgage 2 Years’ Accounts

Can I include other income sources like rental income or investments?

You can. If you’re renting properties out, it’s the same criteria as being self-employed. Some lenders will want proof that you’ve been doing that for two years. Others may be okay with the first year of rental income and accept how much you’ve earned from that.

With other income, as long as it’s documented on your tax calculation and tax year overviews, it’s acceptable to a lender. If you receive maintenance from an ex-partner or Child Benefit or Child Tax Credits, you can use that alongside your self-employed income.

Will I be assessed on net profit, gross income or dividends?

This depends on each lender. For example, if you’re a limited company director and the business earned £200,000, but you have only taken £50,000 out, some lenders will just look at the £50,000 in salary and dividends.

Other lenders will look at the salary you’ve paid yourself plus net profits from the business. It massively depends on the lender as to the income they take when you are self-employed.

Do I need an accountant to prepare or certify my accounts?

It helps. If you are just a sole trader, some lenders are okay if you’re doing it on your own, but others have more stringent checks in place and want a qualified accountant to manage this for you.

Some lenders need that accountant to have a particular qualification, depending on how the business is set up, its size and the lender’s criteria. Having an accountant helps, but it’s not essential with every lender.

What documents do I need to apply for a mortgage with two years of self-employed accounts?

When applying for a mortgage if you’re self-employed, you need your last two years’ tax calculations and tax year overviews. If you’ve only got one year, some lenders can accept that.

You also need your company accounts as submitted to HMRC. In terms of other documents, you’d also need ID, proof of deposit and four months’ bank statements, which you’d need for the business to document the income, and also your personal statements, plus a copy of your credit report.

It’s very similar to what you’d need if you were employed, with a little extra.

How much deposit do I need if I only have two years of accounts?

Having two years’ accounts is a good position to be in with most lenders. Again, it depends which lender you look at. There are some lenders that allow a 0% deposit mortgage, although there are lots of hoops to jump through to be accepted.

For the vast majority of lenders, if you’ve got two years worth of accounts, you can get a 5% deposit mortgage.

Can I still get a high Loan to Value mortgage?

Yes, you can still have a 95% mortgage with a 5% deposit. But with lenders, the bigger the deposit you’ve got, the less risk they take on – and with less risk, they can usually give you a better interest rate and be more lenient on your credit profile.

If you’ve got a 5% deposit and, for whatever reason, you don’t keep up with your mortgage payments and they have to quickly repossess and sell your property, they could lose money. Because of that, the interest rates are higher.

So yes, you can do it, but they’ll charge you a slightly higher interest rate for a 5% deposit.

Will my credit score impact my eligibility more because I’m self-employed?

Lenders have their own internal scoring system and they always view self-employment as slightly higher risk. There may be some situations where that may create an issue.

Ultimately, if you’ve got a good credit score it won’t matter whether you’re employed or self-employed. If you’ve got a bad credit score, whether you’re self-employed or employed, that will be assessed the same way.

The more recent any missed payments are, the more impact it will have. With impacting factors on your credit report such as missed payments, defaults or CCJs, it’s worth paying them off before applying for a mortgage. Lenders may potentially lend you more if you’re fully up to date with everything.

Is it better to go through a mortgage broker for a mortgage if you’re self-employed?

Of course I’m going to say, yes, it is. But there’s a good reason for that. If you go to a particular bank, perhaps their criteria won’t favour self-employed people. They may only look at the money you’ve taken from the business rather than the net profits.

That can cause a huge disparity in how much you can borrow. By looking at the wrong lender you might give up, because you don’t think it’s doable.

Plus, if you’ve just got a year’s accounts rather than two, a lot of lenders will just kick it back and say it’s impossible to get a mortgage. But there are lenders out there that will accept you with just one year’s accounts. It’s our job as a broker to find a deal that will work for you.

YOUR PROPERTY MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON YOUR MORTGAGE.

Approved by The Openwork Partnership on 15/09/2025.