For many professionals in law and tax advisory firms, making partner is the pinnacle of career ambition. It’s recognition of years of expertise, client development, and internal contribution. But alongside the prestige comes a subtle financial shift: the move from salaried employment to self-employed partnership.
That shift, while often celebrated, creates immediate complications when it comes to mortgage borrowing. Most lenders treat new partners as self-employed individuals, which means they want to see
two years of accounts or tax returns before considering an application. For newly qualified partners, that requirement can be an impossible hurdle.
Yet, there are lenders who take a more pragmatic approach, recognising the unique circumstances of professionals in law firms and tax advisories. In 2025, we’re seeing greater willingness to consider
projected partnership income — sometimes referred to as a “reference salary” — as the basis for affordability. This blog explores why the problem exists, how lenders are adapting, and where Willow Private Finance can help.
The Challenge of Transitioning from Employment to Partnership
When a solicitor, barrister, or tax adviser is promoted to partner, the structure of their income changes. Instead of receiving a fixed monthly salary, they typically draw from partnership profits, often supported by quarterly or annual distributions. From a lender’s perspective, that income is
variable and reliant on the profitability of the firm.
Here’s the crux:
- A newly promoted partner may have a letter from the firm outlining their
projected income, often substantially higher than their previous salary.
- However, mainstream lenders don’t view that projection as “proven” income. They want the track record:
two years of filed accounts, SA302s, or tax returns.
For a professional who might have earned £120,000 as an employee and is projected to earn £250,000 as a partner, the irony is stark: their borrowing power often
shrinks in the short term, just as their career prospects accelerate.
We’ve seen this issue play out repeatedly, and it’s a common theme across professions. In fact, many of the same hurdles apply to
self-employed borrowers more broadly, but newly qualified partners face the challenge at a particularly sensitive career moment.
Why Lenders Are Cautious
Lenders aren’t deliberately obstructive — but they operate within strict underwriting frameworks. A few key issues underpin their caution:
- Profitability Risk: A partner’s income depends on the firm’s performance, which may fluctuate year to year. Without historical data, it’s difficult to establish stability.
- Self-Employed Classification: Even though law firms and tax advisories are stable professional environments, the partner’s new status places them in the “self-employed” box for lending purposes.
- Regulatory Prudence: In today’s environment of heightened compliance and regulatory scrutiny, mainstream lenders prefer simplicity and historic proof rather than projected future earnings.
This approach works fine for business owners who’ve been trading for years, but for a newly promoted partner, it creates a frustrating mismatch.
The “Reference Salary” Approach
Thankfully, not all lenders apply the two-year rule so rigidly. A select group of banks and specialist lenders now accept
“reference salary” documentation provided by the law firm or tax advisory.
What does this mean?
- The partnership issues a letter confirming the partner’s expected drawings or guaranteed minimum income.
- Lenders may also request details of recent performance and projections for the firm overall.
- Instead of relying solely on historic accounts, the lender uses this projected figure as the basis for affordability.
This approach aligns much more closely with reality: if the partner is due to receive £250,000 this year, basing lending capacity on the previous £120,000 employed salary is not just unhelpful — it’s misleading.
Case Study: A Newly Qualified Partner in 2025
We recently worked with a client who had moved from senior associate to partner in a London law firm. Their previous salary was £130,000, but the partnership letter projected annual drawings of £280,000.
When they approached a high street lender, the response was predictable:
“Come back in two years with filed accounts.” This left the client unable to borrow more than £500,000, despite their increased earning potential.
By contrast, a private bank we work with was prepared to accept the partnership’s reference salary. The result? The client secured a mortgage facility of £1.2m on competitive terms, enabling them to purchase a family home that would have been out of reach otherwise.
This is precisely where the market is evolving in 2025 — with specialist lenders acknowledging the professional structures of law firms and tax advisories and tailoring their underwriting accordingly.
Timing Matters
Another challenge for new partners is timing. Partnership promotions often take effect mid-year, meaning income can look
fragmented when assessed at the first tax return. For instance:
- Six months employed salary.
- Six months of partner drawings.
On paper, it looks irregular. In reality, it represents a stable and growing trajectory.
This is where using the right lender matters. Many of the specialist banks now consider hybrid years on a case-by-case basis, ensuring borrowing isn’t unfairly restricted during the transition.
How This Links to Broader Lending Trends
The shift we’re seeing with newly qualified partners fits into a wider pattern in the mortgage market: greater specialisation and bespoke underwriting.
We’ve seen similar changes in how lenders treat:
New partners in law and tax advisory firms sit at the intersection of these challenges: technically self-employed, professionally stable, but often misunderstood by mainstream lenders.
How Willow Can Help
At Willow Private Finance, we’ve built strong relationships with lenders who understand these nuances. Our team regularly works with lawyers and tax professionals stepping into partnership for the first time.
We know which banks will consider a
reference salary, how to package applications with partnership letters and firm projections, and how to negotiate terms that reflect reality rather than bureaucracy.
Whether you’re purchasing a first home as a partner, refinancing an existing mortgage, or exploring investment property, the key is engaging with a broker who knows this specialist area inside-out.
📞 Want Help Navigating Today’s Market?
Book a free strategy call with one of our mortgage specialists.
We’ll help you find the smartest way forward—whatever rates do next.
