Self-Employed Mortgage Borrowing
Getting a mortgage when you're self-employed isn't harder than for employed people - it's just different. Understanding how lenders assess your income is key to maximising what you can borrow.
How Lenders Calculate Self-Employed Income
Different lenders have different approaches, and using the right one for your situation can significantly increase your borrowing power.
Income calculation methods:
- Sole Traders: Net profit from your tax returns
- Ltd Company Directors: Salary + dividends OR salary + share of net profit
- Contractors: Day rate x working days OR standard director calculation
The Net Profit Advantage
If you're a company director who's tax-efficient (low salary, moderate dividends, profits retained in company), specialist lenders can use your share of company net profit instead, often allowing 40%+ more borrowing.