5 Self Employed Mortgage Myths

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5 Self Employed Mortgage Myths

We help self employed people boost their mortgage chances day in day out. We often hear things our client’s have heard from a friend, or on the grapevine which aren’t true. Here is a list of 5 self employed mortgage myths you should know about before getting your mortgage approved.

1. You need 3 years accounts to get a mortgage.

Although it is true that the more accounts you have, the better your chances are of getting approved, this is simply not always the case. There are many lenders who will now work off 2 years accounts, and in some cases, income from just one full years’ trading can be used for the purposes of calculating your maximum borrowing capacity (but only where everything else presents well).

2. If you own your own limited company, and employ yourself, you can get a mortgage based on your most recent 3 pay slips.

This one’s definitely not true I’m afraid. It would be pretty easy for a limited company director to increase their income over a short period for the purposes of getting a bigger mortgage. This is not something which is allowed as income derived in this way is unlikely to be sustainable. Instead, lenders will almost always want to see that your income from the business is sustainable over a number of years.

3. Because you’re self employed, you’ll need a bigger deposit and a perfect credit score.

Most lenders will accept income from self employed people. Though some are more understanding than others. What this means is that it’s highly likely a self employed person or director will have access to a very similar range of products as the average Joe, so if you’ve only got a deposit of 10% or even 5%, or you’ve had a few credit issues in the past, provided your income presents well over a sustained period.

4. There’s no way you’ll get a mortgage without a Chartered Accountant.

We’re massive advocates of using accountants to submit your tax returns. That being said, if you’re self employed and have been able to produce your financial records accounts compliantly and pay your tax on time, there’s no reason you shouldn’t be able to get a mortgage. From time to time, we do see cases where an accountant is required to wade in to answer questions the lender might have about sustainability.

5. I need to own 100% of my company to get a mortgage

You can get a mortgage based on ownership of the business from just 20%. If you don’t own this much of the business, you might still be able to get a mortgage, but instead of reviewing the company accounts, you might be treated as a regular employee.

Get in touch with us if you think there are any self employed mortgage myths that we’ve missed, and we’ll add them to the list.

What people are saying:

sam tapsellsam tapsell
17:17 11 Mar 24
Chris has been super helpful, always provided honest advice tailored to my situations. Highly recommend!
Ann-Marie JonesAnn-Marie Jones
17:47 18 Jan 24
Highly recommend Chris at Exley Financial Planning. He was really helpful and has walked through each stage carefully with patience and helped secure us a better rate on our mortgage.
Jasmine ScottJasmine Scott
20:21 18 Jul 23
I’ve had the pleasure of working with Chris now for over 6 years. He’s arranged my last three mortgages for me successfully. I’ve always found Chris to be highly efficient, and clear and open in all of his communications. He’s also taken the time to explain my options and be at the end of a phone. I trust him implicitly and would recommend him to anyone looking for sound financial advice and support regarding money matters.
Mike WilliamsMike Williams
16:37 18 May 23
Couldn't recommend a better financial planning advisor.Chris's help, advice and knowledge base was second to none.
Deborah NDeborah N
11:41 18 May 23
Chris was outstanding. His service was attentive, comprehensive and he displayed an impressive knowledge of his field. He was always easy to contact, friendly and returned calls and messages promptly. His help was invaluable. We are incredibly grateful for all his assistance and wouldn't hesitate to recommend him to others.
Jay ProbertJay Probert
12:02 07 Jul 22
Chris was referred to my wife an i by a neighbour. Despite conducting all communication online (emails/MS Teams calls) at all times Chris has remained personable and responsive. My wife and i are far from experts in this field but Chris' calming approach to the process has been most reassuring and would strongly recommend his services to others. Thanks Chris.
Alexia BowlerAlexia Bowler
08:27 25 Apr 22
We recently used Exley Financial Planning (Chris) for our mortgage and they were so professional, efficient and listened to our every need. We got some very good advice and felt confident that they had our interests at heart. I would use Exley Financial Planning again for anything finance related, and feel relieved we've now got someone who takes us through documents and processes (most of which are fairly confusing!), step-by-step. Thanks Chris!
bethan boddybethan boddy
11:55 08 Mar 22
Fantastic service from Chris.Chris helped me with the process of getting my mortgage from start to finish. As a first time buyer, I was clueless. Having Chris help me made the process a lot easier and he was able to explain information to me that I was unsure off.I highly recommend this company to anyone, especially first time buyers.
Ellen MorganEllen Morgan
08:26 31 Mar 21
I can’t thank Chris enough for all his help throughout my purchase. It hasn’t been an easy process buying my first home during a pandemic, but Chris made securing a mortgage a breeze! Chris is very knowledgable and was honest with me from the outset about what was affordable for me and the mortgages available. It has been a long process for me, but Chris is always available on the other end of the phone to answer any questions I had and kept me updated every step of the way. Brilliant service, I would highly recommend! Thank you Chris!
Rod DCRod DC
19:42 19 Aug 19
Chris has been absolutely fantastic in helping us secure our mortgage offer.Our own situation was a bit more complex due to work and contracts but Chris has worked extremely hard to find us a mortgage that suits us.The quality of service has been top notch from the first meeting. Communication has been excellent and we have been constantly updated on the situation and progress of all processes.It has been so worth employing the services of Exley and I cannot recommenced the service more.

What we’re talking about:

7 Mortgage Mistakes You Need To Avoid

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