Getting a self-employed mortgage without certified accounts

What happens if you’re self-employed, want a mortgage, but don’t have signed-off accounts?

Lenders want at least one year’s trading history from self-employed applicants. But, because of the way the tax year falls, providing them can be tricky for the newly self-employed.

Don’t panic! We have specialist lenders prepared to assess applications on merit.

Here’s what you can do to improve your chances of getting a mortgage without signed-off accounts:

• What ‘evidence’ self-employed lenders need to see
• Why some lenders reject the newly-self-employed outright
• How some lenders will consider your previous PAYE work history
• Deposit requirements and interest rate expectations
• Our track record of getting mortgages for the newly-self-employed

Mortgage lenders and underwriters love to see self-employed applicants’ certified accounts. If you don’t have them, navigating the lending landscape will present unique challenges.

Once a self-employed individual has a three-year trading history and corresponding certified accounts, it gets easier. Applicants can usually prove that the financial health of their business and income are stable.

Most lenders are then amenable to offering a mortgage. With less than three years’ trading history, lenders may exhibit greater caution regarding repayment capacity.

Anyone self-employed seeking a mortgage without certified accounts needs a specialist broker on side. As such, we’re in a unique position to help you access the mortgage funds your income deserves. This article explores why and how we do it.

Lenders never used to ask me to certify my income. What changed?

Self-employed people used to be able to get a mortgage by self-declaring their income. These were called self-cert mortgages, which the regulator banned after the credit crunch.

Back then, advisers were under no obligation to seek proof of an applicant’s declared income. And, in short, borrowers from all working backgrounds abused this system. It was this abuse that, in many ways, brought about the financial failings that burst the bubble.

Today, things have changed. Lenders and their underwriters must show ‘due diligence’ when appraising mortgage applications. This falls under the remit of the Responsible Lending Guidelines that also help shape lenders’ attitudes to risk.

What evidence do lenders need to see?

Underwriters will ask for proof of your self-employed income. How much history they ask for varies from lender to lender.

Some lenders will ask for two-to-three years’ trading history. Others are happy to proceed with only one year’s certified accounts. Yes, self-produced accounts and invoices will indicate income. But certified accounts from a registered accountant will rubber-stamp it.

If you’ve already got a year’s trading under your belt, you may already have the proof lenders need. You should have an SA302 as well as one year’s signed-off accounts.

But if you’ve just started out working for yourself? You’re only likely to have documentation you’ve generated yourself. This will make it much harder to get a mortgage.

The problem with the UK’s inflexible self-assessment return system

If you’ve only recently become self-employed, you’re unlikely to have filed a tax return. Even if you have, it probably doesn’t cover the full year that many lenders need.

This is where the system is really inflexible. And the reality is, when deciding to go self-employed, the start date is important. But you’re not thinking of the consequences of getting a mortgage when you begin trading.

How the current deadline for tax returns skews “certified” work history

The self-assessment process has prescribed dates in the calendar. Every tax year starts on April 6, and ends on April 5 the following year.

The deadline to submit accounts is January 31, following the end of the tax year. So, what happens if you begin trading on, say, May 2, 2025, after the Mayday bank holiday?

Your first tax year, 2025-2026, is going to comprise only eleven months’ trading. You won’t have a full tax year under your belt until April 5 2027!

Does that mean you have to wait almost two years before applying for a self-employed mortgage?

For lenders who have rigid self-employed mortgage lending criteria, yes. You would have to wait. But, no; not with us!

We’ve built strong relationships with lenders amenable to self-employed workers. Many of them would be willing to assess your application ‘as is’. Their common-sense approach would overcome this barrier, provided your business was on a healthy footing.

Why do some lenders reject the newly self-employed outright?

Lenders aren’t being negative if they reject your application. They have a legal duty to assess applicants’ abilities to repay a mortgage. Often, that’s reflected in their strict self-employed mortgage lending criteria.

Robust proof of income and evidence of sustained affordability are prerequisites. In addition, they also require credible projections of future earnings.

Supplementing “trade history” with “work history” may help

For newly self-employed individuals, certified accounts may not yet exist. In such instances, providing supplementary evidence to support the application significantly enhances the likelihood of approval.

A sustained track record in the same industry may help your cause. Again, we use lenders who adopt a common-sense approach to mortgage underwriting.

Identifying such mortgage lenders in these circumstances invariably requires expert guidance. Our expert brokers are equipped to discuss your options and guide you through the process.

Our track record in getting complex mortgages over the line

Our highly qualified broking team possesses extensive experience in specialist mortgage scenarios. Since 2004, we’ve secured mortgages for complex cases, including:

• Adverse credit
• Zero-hours contracting
• Buy-to-let portfolios
• ‘Day-1’ contractors
• All types of self-employed buyers

We even have a proven record of securing mortgages for people whom other lenders have rejected. To date, this has garnered over 900 5-Star reviews on Google and Facebook.

Deposit requirements without certified accountants

Even specialist lenders may expect a compromise if you have less than a year’s accounts. For a start, your credit rating will have to be almost perfect. And the interest rate they offer may not be their most competitive.

But where you can help yourself no end is by having a bigger deposit. This works for you in two ways:

• Reduces the ‘risk’ a lender faces, should you become unable to meet your repayments
• Will reduce your mortgage repayments from the outset

Most of all, a larger deposit, 10-15%, will show that you’re serious. It will highlight your intent to mortgage underwriters. And it will avail you of more deals with more lenders at better rates.

It’s not impossible to get a mortgage without certified accounts. And our brokers will work hard to get you the mortgage that your graft deserves.

They will be honest with you, even if that means telling you to wait a while. So prepare yourself for compromises along the way. But every journey begins with a single step. Take that first step by reaching out to our brokers today.