Owning a business or working for yourself doesn’t mean you can’t obtain a mortgage. Lenders are aware of the situation of self-employed people, so they have a pretty straightforward process in place to work out how much they would lend. Whether you are a sole-trader, a partner or a company director, there is a process by which you can obtain a mortgage. In the case of sole traders and partners, the main criteria considered is the individual’s net profits while for company directors it’s their salary and paid dividends that are looked at.

Lenders will vary in the amount of time it is expected an applicant will have to provide evidence of income for. Most will look at the income received over the last two or three years and either average it out or take the most recent year as a basis for calculation.

Many self-employed people who work on a freelance basis often have income from various sources. Freelance musicians, for instance, will be paid on a self-employed basis for much of their work but some of their teaching work will be on a PAYE basis with their income being taxed at source. This latter will show differently on your SA302 form but with good justification and clear presentation, it will be treated no differently and should still contribute to your income for the year.

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