Mortgages For Self-Employed Without Accounts

Applying for a mortgage as a self-employed individual can be tricky. Lenders tend to be cautious with self-employed applicants, as verifying income and assessing its consistency can be challenging. This uncertainty is viewed as a risk, as lenders need assurance that the borrower can make regular mortgage repayments.

Lenders need proof of affordability to guarantee responsible lending. In this article, we’ll discuss your options for applying for a mortgage without official accounts, how lenders assess these applications, and tips to improve your chances of approval.

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Can You Get a Self-Employed Mortgage Without Any Accounts?

Yes, it is possible to get a mortgage if you’e self-employed without any accounts. However, most lenders will want to make sure you’ve had stable income for at least 2-3 years, so it’ll differ from person to person. If you’ve recently turned self-employed and got no real proof of consistent income, it’s going to be extremely difficult.

Remember, threse lenders have a legal duty to make sure that the people living in these homes can afford to pay their mortgage back consistenly, each month. 

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Why is it So Hard to Get a Mortgage Being Self-Employed?

The reason it can be pretty tough to get a mortgage if you’re self-employed is because people who are self-employed typically have very unpredictable income, and especially if you’ve just started, and you have no proof of consistency, it bears an even bigger challenge. 

Whereas, if you were full-time employed, for example, lenders know that you’re going to have a consistent paycheck of income, relatively similar to the previous month. Of course, no job is guaranteed, but it is certainly more predictable than self-employed income.

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What Lenders May Accept Instead of Accounts

Guarantor support: Some lenders may be more willing to approve your application if you can provide a guarantor who is willing to take on some of the financial responsibility. For more information on how guarantors work and the responsibilities involved, check out Citizens Advice - Using a Guarantor.

Contracts or upcoming work: If you're a freelancer or contractor, showing confirmed contracts or agreements for future work can be a way to validate your income potential.

Tax returns (SA302s): Many lenders will accept your HMRC tax calculations and tax year overviews as proof of income instead of traditional accounts prepared by an accountant. 

To get these documents, you can access your Self-Assessment tax return on the HMRC website. For more detailed information and guidance on how to file your self-assessment and retrieve your tax documents, visit the official Gov.uk Self-Assessment Tax Returns page.

Bank statements: Providing a history of consistent income through your business or personal bank statements can help demonstrate your affordability.

Deposit size: A larger deposit (e.g., 15–25%) can make you less of a risk in the eyes of the lender, which may offset their concerns about your lack of accounts.
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How to Improve Your Chances of Getting a Mortgage Without Accounts

1. Research different lenders and check their requirements (as some are more flexible with self-employed applicants)
2. You must make sure your financial profile is as healthy as possible by keeping a strong credit score and clear, organised financial records
3. Use an online mortgage quote tool to compare mortgage options and find the best provider for your personal needs
4. Maybe look at remortgaging if you already have a mortgage, as it may offer better terms
5. Look at getting expert remortgage advice from mortgages brokers that provide access to both high-street and specialist lenders

In addition to these strategies, there are other ways you can improve your chances of securing a mortgage, even if you don't have traditional accounts. Let’s explore some additional options that might help you get the mortgage you need.

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#1 - Save a Larger Deposit

One way to strengthen your mortgage application is by saving for a larger deposit. Lenders are more likely to approve your mortgage application if they can see that you have a significant amount of equity in the property. A larger deposit reduces the lender’s risk, making them more likely to offer a loan, even if you don’t have formal accounts.

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#2 - Look at Specialist Lenders Who May Be More Keen

Some lenders specialise in providing mortgages to self-employed individuals who don’t have the typical documentation, such as accountants' reports. These lenders often consider other factors such as your business potential, the consistency of your income, and your creditworthiness. While the rates may be higher, these specialist lenders can be an excellent option for those who have difficulty meeting the criteria of traditional banks.

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#3 - Continue to Show Consistent Income Over Time

If you’ve been self-employed for some time, lenders will want to see evidence that you can sustain your income. Even without formal accounts, consistent earnings over the last year or two—whether in the form of bank statements, invoices, or contracts—can work in your favour.

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#4 - Explore the Potential of Professional Help

Working with a mortgage broker can be incredibly helpful, especially if you're self-employed without accounts. Mortgage brokers can help you identify the right lenders for your situation, navigate the application process, and present your case in the best possible light. They can also assist in gathering the documentation you need to support your application. If you're considering applying for a mortgage and need expert advice, Bell Financial Solutions can help you find the best options.  
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‍What Types of Mortgages Can You Get Without Accounts?

There are many types of mortgages available for self-employed individuals without accounts:

Income-based mortgages - Some lenders offer income-based mortgages, where they will assess your income through other documents like bank statements, contracts, and invoices. These types of mortgages may have slightly higher interest rates but can be a good option for those who can show regular income.

Guarantor mortgages - If you're unable to provide sufficient evidence of your income, you may want to consider a guarantor mortgage. This allows a family member or friend to act as a guarantor for the mortgage, securing the loan with their financial resources.

Adverse credit mortgages - If you have a poor credit history or no accounts, some lenders may offer adverse credit mortgages. These mortgages are designed for individuals who don’t meet traditional lending criteria.

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How Much Mortgage Can I Get if I’m Self-Employed?

For self-employed mortgages, the common guideline on how much mortgage you can get is typically 4.5x your annual salary (or 4-5x depending on your situation). Of course, this is extremely generalised and will all depend on your personal circumstances.

Lenders will look at things like:

• Proof of income
• Type of self employment
• Credit history and expenditure
• Income history

… in order to decide on how much they will let you borrow for your mortgage. 

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Will You Need a Bigger Deposit?

Technically, you don’t need a bigger deposit, but with your financial situation being complex and unpredictable, it may sway lenders slightly into giving you more optionality. This is because if you can show you will have a smaller LTV (loan to value), this will drop your monthly payments

Of course, this still doesn’t guarantee you’re going to get the self-employed mortgage, but it does show you have intentionality, make more savvy financial decisions (i.e. savings for a home), and have better business potential.
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Get Started With a Mortgage Broker With Self-Employed Experience

So now that you know that it is possible to get a mortgage as a self-employed individual without traditional accounts, we have been fortunate enough to receive 5-star reviews from our customers and will continue to try and provide the best service we can around the country.

If you’re self-employed without accounts, it’s important to work closely with a professional to explore your options to make sure you find a mortgage that suits your financial situation. So, if you want to get started, reach out to Bell Financial Solutions today to discuss your options and take the first step towards securing your home.