If you're self-employed in 2025, getting a mortgage might feel more complex than it should be.

You’re not alone.

In fact, 4.3 million people in the UK are self-employed—and lenders are finally catching up to the way modern income works.

In this post, we break down what’s changed, what lenders look for, and how to get approved without the usual headaches.

🧮 What Counts as “Self-Employed” for Mortgage Purposes?

In mortgage underwriting, you’re considered self-employed if you own 20–25% or more of a business, or if you:

• Work as a sole trader
• Are in a partnership
• Own a limited company
• Operate as a freelancer or contractor

It’s not just about tax status—it’s about how predictable your income is.

💡 What Lenders Want to See in 2025

Lender criteria have evolved to reflect the post-pandemic economy and changing work trends.

Here’s what matters most in 2025:

✅ Two years of accounts (some accept one year with strong rationale)
✅ SA302s or tax calculations + tax year overviews
✅ Business bank statements
✅ Evidence of current work or contracts

And increasingly…

📈 Year-on-year income trends matter more than just profit levels.

📝 Limited Company? Show Your Full Picture

Many self-employed borrowers operate via limited companies.

In 2025, lenders look at:

• Salary + dividends (most common)
• OR salary + net profit (for retained profit-based lenders)

If your accountant helps minimise your tax bill, that’s great—but it can lower your affordability.

💡 Tip: Work with a broker who knows which lenders assess retained profit.

📆 One Year of Accounts? It’s Possible

Some specialist and mainstream lenders will accept:

• One full year of trading
• With strong projections and current contracts
• Plus a solid credit history

Ideal for:

• New freelancers
• Contractors switching from PAYE
• Recently incorporated sole traders

🔒 Contractors? There Are Tailored Options

If you work on fixed-term contracts, especially in IT, finance, or healthcare, lenders may assess income using your:

• Daily or hourly rate x number of days worked
• Even if you’ve only been contracting for 6–12 months

📌 Specialist contractor mortgages often offer better affordability calculations than traditional self-employed assessments.

🚧 Common Pitfalls (and How to Avoid Them)

❌ Large recent drop in income? Provide context and a recovery plan.
❌ No accountant-prepared documents? Many lenders require verified accounts.
❌ Mix of PAYE and freelance income? Be prepared to explain it clearly.

✅ Always provide a clear, consistent story of your income.

💬 Real Case Study

Daniel is a graphic designer who switched from full-time employment to freelance in 2023.

By 2025, he had:

• One full year of accounts
• Consistent income via contracts
• A strong credit profile

We placed him with a specialist lender who assessed him on gross contract income—helping him borrow 4.5x earnings with just one year of trading history.

🔍 How Willow Can Help

We’ve helped hundreds of self-employed clients—including directors, consultants, and contractors—secure mortgages with:

• Just one year of accounts
• Retained profits
• Complex income mixes
• International clients or multiple currencies

💼 Whether you’re growing your business or just starting out, we’ll help you put your best case forward.

📞 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.