Self Employed Mortgage: How Much Can I Borrow?

Self Employed Mortgage - How much can I borrow

The question of how much of a self employed mortgage you can borrow can never come with an instant answer. After all, you are talking about a significant amount, which can never be offered without going through certain conditions.

An insight into the essential and related aspects can facilitate the accumulation of information that may help you in the attainment of funds.

Affordability according to self-employment types

Self –employment has varied types, and according to them, the rules on the affordability front can change.

You can borrow up to £40000 or more as a self-employed BUT conditions apply.

If you are working as a sole trader

Several dos and don’ts are necessary to follow to borrow the desired amount.

  • You should have a trading history of 3 years. Some lenders may accept your application with two-year records, but that depends on their lending policy only.
  • Your tax files are also required; the SA302 documents marks its importance to justify the tax thing.

As a sole trader, these are the necessary details required by the lender, but it usually is not practical to expect a considerable amount.

However, through a broker company that offers mortgage for self-employed people, you can explore the possibilities.  The brokers with a whole-of-market approach can perform better on this part. They can also bargain on the interest rates.

If you are working as the company director

The case of company directors is slightly different because they are typically registered as the PAYE employee.

  • A company director gets a salary and dividends from the profit and sometimes some additional income too. Perhaps you also get your income in this manner. These things help to get funds easily.
  • The pension contribution is also there that leaves a good impact on the mortgage affordability.

The loan amount may vary from lender to lender, but generally, with this financial condition, you can expect to borrow a significant amount.

If you are a contractor

A contractor is a free-spirited version of self-employment, but on the mortgage front, it may create some issues. The volatile nature of the income may make things difficult.

  • The number of projects you have from your clients decides the affordability for a certain amount.
  • More contracts you have, higher is the possibility that you gain access to a desirable amount.
  • Your past performance and your future financial conditions always affect the final decision of the lender.

Usually, the tag of ‘contractor’ as the employment status is considered more prone to the rejections. However, it is not a confirmed thing because flexible direct lending nowadays facilitates more straightforward ways of attaining approval. If you are keen on the part of repayment capacity, there should be nothing to stop you from getting approved.


The above conditions are applicable but do not forget that your personal financial condition is the prime decision-maker.

From your current income status to the credit score performance and future business possibilities, everything counts.  The best strategy is to stay strong in your finances, and then you can expect approval for any amount up to £40,000 or more.

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