Do You Need a Bigger Deposit if You’re Self-Employed?
DIRECTOR AND MORTGAGE ADVISER
Specialist broker for high-earning professionals and complex income cases.
If you're self-employed, you've likely heard that getting a mortgage is tougher—or that you'll need a bigger deposit than someone on PAYE. But is that really true?
The short answer: not always. The size of your deposit matters, but it’s not just your employment status that lenders look at. With the right preparation and lender choice, self-employed professionals can access competitive mortgage deals with standard deposit requirements.
Request your fee free mortgage consultation today. No obligation, just sound advice.
What Counts as “Self-Employed” for Mortgage Purposes?
Lenders typically class you as self-employed if you:
Own 20–25% or more of a business
Operate as a sole trader, limited company director, or in an LLP
Receive income through drawings, dividends, or profit share rather than a salary
This includes freelancers, contractors, and small business owners—even if your income is high or consistent.
Do Lenders Require Bigger Deposits from the Self-Employed?
There’s no blanket rule, but some lenders apply tighter criteria if:
You have less than two years of trading history
Your income fluctuates significantly
You’ve recently switched from employment to self-employment
Your income is hard to verify with tax returns alone
In these cases, a bigger deposit (15–25%) may improve your options. However, if your income is well documented and your profile is strong, you may qualify with as little as 5–10%, just like an employed applicant.
How We’ve Helped Clients Like You
These clients faced similar challenges - here’s how we helped them secure the right deal.
How to Strengthen Your Case With Any Deposit Size
Here’s how to improve your mortgage chances, especially if your deposit is on the lower side:
Have clean and up-to-date accounts – Ideally prepared by a qualified accountant
Maintain a stable income pattern – Large swings year-on-year can make lenders cautious
Provide a clear income story – Show how you generate income and why it’s sustainable
Work with a broker – We’ll match you with lenders that understand self-employed income and accept lower deposits
Speak To An Expert Today
Get in touch for a fee free, no-obligation chat about how we might be able to help you.
What Deposit Size Is Ideal for Self-Employed Borrowers?
While some self-employed clients qualify at 5% deposit, most find better rates and a smoother process at:
10% deposit – Opens access to many high street lenders with mainstream rates
15%–20% deposit – Useful if your income is complex, recent, or you’ve had a break in trading
25%+ deposit – Typically unlocks the most flexible underwriting and lower stress testing
Remember, the bigger your deposit, the lower your loan-to-value (LTV), which usually means lower rates and more lender options—regardless of employment status.
Why Self-Employed Doesn’t Have to Mean “Higher Risk”
The key concern for lenders isn’t your employment label—it’s how stable and verifiable your income is. At Kite, we regularly help self-employed:
IT contractors use day rates to maximise borrowing at 90–95% LTV
Company directors use retained profits or dividends to boost affordability
Consultants and freelancers secure mortgages even with one year of accounts
With the right structure and lender, a self-employed income can be just as mortgage-friendly as a salaried one.
What Our Clients Say
Conclusion: Deposit Size Isn’t the Only Factor That Matters
Being self-employed doesn’t automatically mean you need a bigger deposit—it just means your case needs to be presented properly. With strong documentation and expert advice, many self-employed professionals secure mortgages on the same terms as anyone else.
Self-employed and unsure how much you’ll need to put down?
We’ll assess your full income profile and connect you with lenders who understand how you work.
Request your fee free mortgage consultation today. No obligation, just sound advice.
FAQs
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Yes—some lenders will accept one year, especially if you have prior experience in your industry or strong projections.
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Not necessarily. Many self-employed clients secure 10–15% deposit deals, and some qualify with just 5%.
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It helps. Professionally prepared accounts add credibility and speed up underwriting.
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Some lenders will include retained profits in their affordability assessment—but policies vary.
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Not if you’ve stayed in the same industry. Some lenders will use your contract day rate from month one.
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YOUR HOME MAY BE REPOSESSED IF YOU DON’T KEEP UP REPAYMENTS ON YOUR MORTGAGE
Kite Mortgages is a trading style of Kite Financial Ltd which is an appointed representative of The Openwork Partnership, a trading style of Openwork Limited which is authorised and regulated by the Financial Conduct Authority.
APPROVED BY THE OPENWORK PARTNERSHIP ON 31/07/2025.