Newly Self-Employed Mortgage
A newly self employed mortgage becomes realistic at around twelve months of trading, which is the point most specialist lenders will start a conversation. Below that the options narrow sharply, and knowing exactly where you sit matters.
- When the twelve-month clock actually starts
- What lenders accept before a first tax return exists
- Why prior employment in the same field matters
- What to do in the meantime if you cannot wait
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A newly self employed mortgage: the twelve-month threshold, and either side of it
Two of the specialist lenders whose criteria we track publish a minimum trading period in plain terms. Precise requires a minimum of twelve months trading. Pepper Money publishes a minimum trading period of twelve months. Aldermore works to a two-year standard and will consider one year with corroborating evidence. None of them publishes a general policy for applicants with only a few months of trading behind them.
That matters because “newly self-employed” covers two very different situations. Someone eleven months in with a first tax return imminent is close to being a mainstream specialist case. Someone three months in, with no completed accounting period and no self-assessment history, is not – and no amount of packaging changes that.
The useful work in the second situation is preparation rather than application: keeping clean business banking, getting the accountant appointed early, keeping the old employment paperwork, and understanding which lender you are aiming at when the twelve months is up. If you are already past that point, our mortgages with one year of accounts page covers what a single year of figures can support.
One point worth checking before anything else: you may be classed as self-employed by a lender even if you do not think of yourself that way. Precise treats anyone with a shareholding of 25% or more, or who is responsible for paying their own tax and National Insurance, as self-employed. Our whether you count as self-employed page explains why that catches more people than expected. GOV.UK sets out the registration steps in its guidance on setting up as a sole trader.
At a Glance
Minimum trading period by lender
The trading period test is separate from the number of years of accounts a lender wants to see. Both have to be satisfied.
| Lender | Published minimum trading period | Years of figures normally required |
|---|---|---|
| Precise | A minimum of 12 months | 2 years of HMRC tax calculations and corresponding tax year overviews, or accounts. One year can be considered by referral. |
| Pepper Money | Minimum trading period of 12 months | Last 2 years, unless only 1 year is available because of the trading period, plus the latest month's business bank statement |
| Aldermore | Not published as a separate figure | 2 years standard; 1 year considered with corroborating evidence and at a reduced maximum LTV |
Criteria correct as at 14 August 2026. Sources: Precise Mortgages Residential Criteria Guide; Pepper Money Mortgage Criteria Guide; Aldermore Residential Criteria Guide. Correct as at 14 August 2026. Criteria change without notice. Lender criteria change without notice and this table is a general guide, not advice or an offer of credit. Your own circumstances, the property and the lender’s assessment at the time will determine what is actually available to you.
What to put in place from day one
None of this is difficult, but all of it is much harder to reconstruct a year later. GOV.UK sets out the basics of registering and record-keeping in its guidance on working for yourself.
Where to go next
The pages most often read alongside this one.
Mortgage With 1 Year Accounts
Which lenders consider a single year, what extra evidence they ask for, and the LTV you give up.
Am I Self-Employed?
The 25% shareholding rule catches people who think of themselves as employed.
Sole Trader Mortgage
Net profit, not turnover – and the add-backs some lenders will and will not allow.
SA302s Or Full Accounts
Tax calculations, tax year overviews, finalised accounts – what each lender actually wants to see.
Accountant Qualifications
Lender lists differ. Your accountant can be acceptable to one lender and not another.
Mortgages For Contractors
How contractor-friendly lenders work from a day rate or contract value instead of trading accounts.
Self-Employed Mortgages
The main guide: how lenders assess self-employed income, what they ask for and which lenders are worth approaching.
Mortgage Deposit Calculator
See what deposit a given property price and LTV would need.
How we place a self-employed or complex income case
Specialist lenders underwrite manually, so how the income is evidenced and presented genuinely changes the outcome.
Establish how you are actually classed
Lenders do not all draw the line in the same place. Precise treats anyone with a shareholding of 25% or more, or who is responsible for paying their own tax and National Insurance, as self-employed. Getting this right first decides which criteria apply to you.
Read the accounts the way an underwriter will
We work from your tax calculations, tax year overviews and finalised accounts rather than a rough turnover figure, because the number a lender uses is often materially different from the number you think of as your income.
Match the income shape to the right lender
Latest year or average, salary and dividends or share of net profit, one year of accounts or two – these are lender policy choices. We place you against published criteria rather than guessing.
Package the case properly
Specialist lenders underwrite manually. A clear note explaining a dip in profit, a change of trading style or a new contract usually carries more weight with an underwriter than the raw figure on its own.
Plan the next few years
Trading history builds. We look at whether waiting for one more set of accounts, or how you draw income between now and then, would open up materially better options at your next remortgage.
Read More If You Work For Yourself
The first two years are the hardest. These pages explain what lenders look at.
Self-Employed Mortgage Guide
How lenders actually read accounts, day rates and dividends.
How Much Deposit Do You Need?
What each deposit size actually reaches, and what staying small costs you.
Self-Employed Mortgages
How lenders read accounts, day rates and dividends when you work for yourself.
How Much Can I Borrow?
A realistic borrowing figure before you start viewing properties.
Newly self-employed and not sure where you stand?
Tell us your start date and what you did before it. If it is too early we will say so, and tell you exactly what changes and when.
Read more about our mortgages with one year of accounts, whether you count as self-employed or self-employed mortgages guide.
Newly Self-Employed Mortgages - Frequently Asked Questions
How long do I need to be self-employed before I can get a mortgage?
Twelve months of trading is the minimum published by Precise and by Pepper Money, and it is a reasonable planning assumption more generally. Aldermore does not publish a separate minimum trading period but works to a two-year accounts standard with one year considered where there is corroborating evidence. Below twelve months the options are very limited and are best assessed case by case rather than assumed.
When does the twelve months start - registration or first invoice?
Lenders are generally looking at when the business genuinely started trading rather than the date you told HMRC. In practice the evidence that settles it is the accounting period covered by your first set of accounts or your first self-assessment return. If there is a gap between registering and trading, expect to be asked about it.
Can I use my employed income if I only recently went self-employed?
Not usually as current income, because it has stopped. It is still worth keeping the paperwork, because prior employment in the same field is listed by Aldermore as one of the ways an applicant can corroborate a single year of self-employed accounts. It supports the new income rather than replacing it.
I went self-employed doing exactly the same job. Does that help?
Yes, and it is one of the few pieces of supporting evidence lenders name explicitly. It addresses the underwriter’s real concern, which is whether the income is durable rather than whether the business is new. Keep the old contract, payslips and P60s.
Should I take a mortgage before I go self-employed?
If a move is imminent and self-employment is planned, the timing genuinely matters, because an employed applicant with a permanent contract is assessed on a different basis. That said, taking on a mortgage you may struggle to afford after a drop in income is a poor trade. Model the post-change budget honestly before deciding.
Does a limited company change the twelve-month rule?
The trading period test applies to the business either way. What changes is the income definition: directors are usually assessed on salary plus dividends, or on their share of company net profit where a lender allows it. Incorporating part way through does not restart the clock in most lenders’ eyes, but it does need explaining.
What if I have no accounts yet but do have contracts?
Contracts help but rarely substitute entirely for a trading history on a standard self-employed application. Where income is genuinely contract-based rather than trading-based, a contractor assessment may be the better route, and that works from the day rate or contract value instead of accounts.
Will a lender look at my business bank statements?
Frequently, yes. Pepper Money asks for the latest month’s business bank statement alongside the accounts, and Aldermore asks for business bank statements as part of the corroborating evidence for a one-year case. Keep business and personal spending separate from the start, and keep the records HMRC expects you to keep under its guidance on allowable expenses, because those records are what the accounts are built from.
Does bad credit make a newly self-employed application impossible?
It makes it harder, because two lender concerns stack rather than sit side by side. It is not automatically fatal, and specialist lenders assess both. Our self-employed with bad credit guide covers how the two interact and which markers matter most.
What deposit should I plan for?
Plan for more than the mainstream minimum. Lenders that accept limited trading history generally reduce the maximum loan to value, so the deposit requirement rises. Working from a lower loan to value from the outset also widens the lender list, which is worth more than it sounds.
YOUR HOME MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON YOUR MORTGAGE.