Mortgages with Two Years’ Accounts

Recently, it seems like more and more people are choosing to become self-employed. The attractiveness of the prospect is evident, self-employment represents a way of marketing one’s personal interest while perhaps operating on more flexible terms, in comparison to fulfilling a conventional 9-5 salaried role. Whether self-employment entails being a freelancer, sole trader, contractor, or company director, there are obvious facets of such employment that equate to distinct benefits which you can’t find elsewhere. Principally, this is why today in the UK alone there is a reported number of 4.39 million self-employed workers (source). However, despite the impressive presence of the self-employed, there is one standout drawback. Specifically, when it comes to getting a mortgage.

Getting a mortgage has always been a fairly difficult task. Securing that dream home takes a singular amount of time, dedication, and money. Especially now, the mortgages and housing market is characterised by a biting level of competitiveness. But, it may be surprising that it is fundamentally harder for those who are self-employed to obtain a mortgage deal, relative to those who are on a contract and receive a set wage each month. Indeed, the complexity inherent in getting a mortgage is amplified if your form of income falls outside of that which is considered the ‘norm’, even if you are earning a relatively considerable sum every month. The chief reason for this is because of how high-street lenders assess the finances of their applicants, i.e., with unapologetic rigidity.

With this background, it’s easy for self-employed individuals to think that their chances obtaining a mortgage package are rather slim, given that lenders seemingly prefer those in fixed financial positions. Though, while it is true that mortgage providers need to be wholly convinced that your venture has an established and secure footing, there is some room for leeway. Namely, it isn’t a requirement for your business to have been running for 5+ years before you can get a spot on the property ladder, provided that you have access to the correct assistance. After all, the mortgage market is so varied as to house solutions for every type of person, whatever their demands.

In particular, there are mortgages with two years’ accounts out there for those who haven’t been self-employed for a great deal of time, but who still want to have their own property. The crux is that you’ll likely need to find a specialist lender who is accustomed to handling cases regarding those with similar personal circumstances and financial situations to yours. Followingly, we highly suggest that you hire the services of an expert mortgage broker to thoroughly assess your options in order to match you with such a lender. We at The Mortgage Genie have assisted plenty of our UK clients by landing them a mortgage when they’ve had just two years’ worth of accounts, despite the usual obstacles. If you’re interested in joining those among our success stories, then be sure to give us a call at 01915809890 today.

Yet, regardless of what we can do for you, it’s still important that you come to terms with everything there is to know about mortgages with two years’ accounts. So that you can get a comprehensive grasp on all the salient details, we’ve put together this piece which goes over all the integral specifics of the matter. We’ll cover:

Why is it hard to get a mortgage with two years’ accounts?

Generally, it is hard to get a mortgage if you only have two years’ accounts because the majority of high-street lenders wish to see more evidence of your income. It could be the case that your business or personal venture is flowing quite smoothly and you’re doing well financially, but this is besides the point in question.

That is, lenders are required to verify that your income is intrinsically stable and accurately defined, and two years’ worth of accounts is typically seen as insufficient where borrowing is concerned. In this context, a business which has been running for two years is viewed as still finding its footing.

The logic behind this is simple: lenders do not want to leave any space for the potential of you failing to make those vital monthly mortgage repayments, given that it would be bad both for you and them, and so want your employment to be as established as possible. Although, this doesn’t go to say that you can’t get a mortgage if you have two years’ worth of accounts, it just means that you need access to a lender who is experienced in dealing with the self-employed.

How long do I have to have been self-employed to get a mortgage?

In theory, there is no cutoff point to how long you have to have been self-employed to get a mortgage if you have evidence enough which denotes a solid income. For instance, there are even mortgages for one years’ accounts for those to whom they apply.

Having said this, if you want the choice of a variety of different options, then the bulk of lenders will want to see three years’ worth of accounts, or at least your first year’s tax return. In practice, this is so that they can easily calculate your affordability. If you currently have two years’ accounts, then of course, it’s worth considering waiting a year until you can provide a greater insight into your finances. Waiting could not only improve your chances of being accepted for a mortgage, but also entitle you to deals with competitive interest rates, something to bear in mind when taking into account the extra fees and charges that come with all mortgage packages.

It used to be so that self-employed borrowers could ‘self-certify’ their mortgage applications, essentially allowing them to circumvent these restrictive guidelines. However, the result was lots of individuals taking on loans which they could not realistically afford. Consequently, this directly brought about a ban of such self-certification mortgages in 2014, and is why lenders now take a more strict approach to their assessments of the self-employed.

How do I prove my income if I’m self-employed?

Proving your income is a core part of what makes up your mortgage application. So, the clearer your total income is, the easier it will be to get a lender who will consider coming to an agreement with you. To reiterate, not having satisfactory evidence of income is the chief reason as to why a lot of self-employed individuals get rejected for a mortgage loan.

In essence, there are two primary pieces of documentation that you’re required to provide a lender with. Firstly, finalised accounts created by a qualified accountant, and secondly, a self-assessment tax return (SA302 document). You can either ask the latter to be posted to you, or you can download such documentation online through the HMRC portal.

Can I get a mortgage with two years’ accounts?

Simply put, yes you can get a mortgage with two years’ accounts, but your success also depends upon other personal factors. Beyond having adequate proof of income so as to convince a lender that you are in a stable enough position for a mortgage, there are other significant influencing factors which determine whether or not you can get a mortgage with two years’ accounts. Namely, all lenders - as part of their evaluations - carry out a hard credit check in order to get a notion of your overall financial health.

This hard credit check will reveal the quality of your credit score, which if deemed as bad credit, can act as a red flag for a lot of lenders and cause them to turn you away. Moreover, your credit report will also show if you’ve run into any other related financial issues in the past, as typified by court county judgements (CCJs), IVAs, payday loans, and bankruptcy. Evidently, the presence of any of these on your profile will work to impress a negative influence on your mortgage application. Albeit, this doesn’t always imply rejection. If such instances occurred over six years ago, then their severity will be reduced. Likewise, if you have a substantial mortgage deposit, then this sum can work to offset any previous monetary troubles, due to how it displays good money-handling capabilities.This being said, if you’ve got bad credit on top of being self-employed, then having a specialist mortgage broker like ourselves at hand becomes a necessity.

It should be mentioned that hard credit checks leave a mark on your report. Consequently, if you want to get an idea of your current financial eligibility before you apply for a mortgage, you can use our free credit check tool (£14.99 per month after the free 30-day trial). Using it will help you to see any possible mistakes or fraudulent activity on your profile, so that you can deal with such problems as soon as possible. The trial and subscription can be cancelled at any time.

How much can I borrow with two years’ accounts?

How much you can borrow, just as if you were in full-time employment, is determined by your income and credit history combined, in addition to what industry you work in. For example, those who work in educational and medical sectors will find that it’s easier for them to get a mortgage, relative to if they were in a rather niche area. This is because there will always be demand for professions associated with the former industries, in turn, signalling a guarantee of future work i.e., income.

Furthermore, if you’re in a partnership or are a sole trader, then the amount you’re able to borrow will be based on your share of the net profit from the two years’ worth of accounts you have. On the other hand, if you’re a company director, then the scale of your borrowing is down to either the salary you give yourself, or the dividends you receive yearly. For an exact figure, we recommend that you make use of our mortgage calculator to find out how much you could borrow up to today.

Which lenders offer mortgages with two years’ accounts?

Mortgages for those with two years’ accounts are categorised as being a specialist mortgage type. What this means is straightforward, that in order to get a mortgage if your business has been going for a relatively short length of time, you’ll need to contact a specialist lender, as we mentioned previously.

Reason being, that specialist lenders take an understanding approach when it comes to more complex forms of income, and are therefore more suited to the self-employed. Whereas, high-street lenders’ eligibility criteria often exhibit a bias towards full-time salaried workers. Usually, the prerequisite for finding a suitable specialist lender is employing a specialist mortgage broker. Specialist mortgage brokers have a readily-available pool of specialist lenders and are geared to discern those who are the most likely to offer you a mortgage loan.

Here at The Mortgage Genie we have in-depth knowledge on how to get a mortgage and are committed to helping people secure loans of all types, especially if they’re self-employed and only have two years’ accounts. We hope that this article has answered all the questions you’ve naturally asked yourself surrounding mortgages with two years’ accounts, as well as cleared up any sense of confusion you might have had.

Each day we help an increasing number of people to achieve housing happiness by locating the mortgage product that’s right for them, one which is tailored towards their personal situation and individual circumstances, as well as by guiding them through every step of the process. If you require a team of expert mortgage brokers, then be sure to get in touch with us at 01915809890 and we’ll get started on a solution that has you owning your dream house!

Company Information

The Mortgage Genie Limited is Registered in England and Wales with Company Number 9803176. The Mortgage Genie Limited is an Appointed Representative of PRIMIS Mortgage Network, a trading name of First Complete Ltd. First Complete Ltd is authorised and regulated by the Financial Conduct Authority. Most Buy-to-Let Mortgages are not regulated by the Financial Conduct Authority.


Depending on the complexity of your mortgage there may be a fee for our mortgage advice and arrangement service, which will be discussed and agreed before you make a mortgage application. A typical fee is £293 and will never be more than 1% of the mortgage amount.