Self-employed mortgages with 1 year's accounts

Can I get a mortgage with 1 year’s accounts?

Yes, it is possible. While most high-street banks prefer 3 years of history, specialist lenders consider applications with just 12 months of trading.

Because you have a shorter track record, lenders will look beyond just your latest tax return. They will use the “underwriting” process to look at your professional background, specifically:

• Your experience: How long you worked in this trade before going self-employed.
• Consistency: Whether your current business matches your previous career history.
• Previous earnings: Your income levels in the years leading up to starting your business.

Market Insight: Gross mortgage lending is forecast to reach £320bn in 2026 as the market continues to recover. Industry experts note that “complex income” scenarios – including self-employment and the gig economy – are becoming a standard part of the UK mortgage landscape, leading to a more borrower-friendly environment ^[1].

How much can I borrow?

Lenders primarily focus on your income amount rather than the age of your business. Generally, you can expect to borrow 3.5–5.5 times your annual income, though your specific “multiplier” depends on your risk profile.

Pro Tip: If you can provide a larger deposit, it lowers the lender’s risk (the “LTV ratio”), which can often open doors to more competitive rates even with only one year of accounts.

What influences your borrowing limit?

• Credit history: A clean credit score usually unlocks higher multipliers. If you have “bad credit,” lenders may limit the loan amount to reduce their risk.
• Deposit size: While you may only need a 10% deposit (the same as anyone else), a larger deposit often unlocks lower interest rates and higher borrowing limits.

Can I boost my borrowing limit?

Yes. You may be able to borrow more than the standard multiples if you meet certain criteria:

• High earners: If your annual income is above average, some lenders increase their multipliers.

Example: An income of £75k might jump from a 4.5x to a 5.5x multiplier, increasing a loan from £337,500 to £412,500.

• Using projected income: If your second year of trading is much stronger than your first, an accountant can provide “projected figures.“

The impact of using projections:

• Standard approach: £30,000 income x 5.5 = £165,000 loan.
• Projected approach: £40,000 income x 5.5 = £220,000 loan.

Note: Using projected figures requires your current year to show significant growth (e.g., hitting your previous year’s total within only 9 months).

How much deposit will you need?

You will be pleased to know that you won’t be required to put down a larger deposit than anyone else just because you have only 1 year’s worth of business accounts.

• The minimum: Typically, a lender will look for a deposit of at least 10% of the property value.
• The ideal setup: Pairing a 10% deposit with a clean credit history from the last 6 years will put you in a favourable position for an application.
• The long-term benefit: While 10% is the baseline, providing a larger than average deposit is a good idea. Lenders are more inclined to offer lower interest rates to those with more equity, as you are seen as a less risky borrower.

Even though you are putting down more money initially, the savings in interest could significantly outweigh this cost in the long run.

Deposit Accessibility: The share of new mortgages with a loan-to-value (LTV) ratio exceeding 90% reached 7.4% in late 2025 – the highest share recorded in over 15 years. This trend highlights a surge in accessibility for those with a 10% deposit, even as lending standards remain robust ^[2].

How can I improve my chances of mortgage approval?

Preparing your application before you speak to a lender can be the difference between a “yes” and a “no.” If you only have 1 year of accounts, follow these steps to strengthen your position:

The Broker Advantage: Approximately 87% of all regulated mortgage lending is now conducted through brokers. IMLA reports that as the mortgage market grows more complex, the role of intermediary advice is “greater than ever” to help borrowers navigate evolving product choices and regulation ^[3].

Who counts as self-employed?

Lenders categorise self-employment in different ways depending on your business structure. Whether you are a solo freelancer or running a team, you can typically apply if you fall into one of these categories:

• Sole Traders: You own the business and keep all the profits after tax. Lenders will look at your net profit for the year.
• Limited Company Directors: You own at least 20–25% of the business. Lenders usually look at your combined salary and dividends, though some specialists can consider your share of retained net profit.
• Contractors & Freelancers: You work for various clients or agencies. Some lenders will assess you based on your day rate rather than just your annual accounts.
• Partnerships: You share ownership with one or more people. Your share of the business’s net profit is what counts toward your mortgage affordability.

Proving your income if you have 1 year’s worth of accounts

As evidence of your self-employed income, mortgage lenders will refer to your business accounts. They will need accounts to be prepared by a certified or chartered accountant.
They are also likely to use your SA302 year-end Tax Calculation form (and accompanying breakdown) from HMRC. This will give a tax year overview of your businesses earnings, which is also crucial in helping a lender determine how much you can borrow.

Having both of these prepared and ready to go before you apply can speed up the application process.

Can I remortgage with 1 year’s accounts?

As with obtaining a normal mortgage, it can also be possible for a self-employed person to remortgage using just 1 year’s accounts. A number of lenders have become more flexible in their approach and moved away from the traditional view that self-employed borrowers should have at least 2 or 3 years’ worth of accounts in order to be trusted with a mortgage.
It will also be possible to remortgage later on down the line when you have another 2 or 3 years accounts. This could allow you to borrow more if your self-employed earnings have increased in more recent years.

Self-employed mortgages using last year’s accounts

As mentioned previously, most lenders average your income over 2 or 3 years. But what if your most recent year was significantly more profitable?

You don’t have to be held back by your past. It is possible to find lenders who will ignore previous lower-earning years and assess you solely on last year’s accounts. This works the same way as a 1-year application – if you meet the specific requirements of these niche lenders, you can secure a loan based on your current, higher strength.

References

1. https://www.imla.org.uk/news/post.php?s=2025-12-16-imla-forecasts-sustained-growth-in-mortgage-lending-through-2026-and-2027
2. https://www.imla.org.uk/perch/resources/publications/imla-the-new-normal-prospects-for-2026-and-2027.pdf
3. https://www.fca.org.uk/data/commentary-mortgage-lending-statistics-q3-2025