Mortgages for Freelancers

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Written by:

Alison Gibson

Ascot Mortgage Expert

Last Updated:


Written by:

Alison Gibson

Ascot Mortgage Expert

Last Updated:


Freelancing has become increasingly popular in the UK, with more individuals opting for the flexibility and independence it offers. However, when it comes to securing a mortgage, freelancers often face unique challenges. If you’re a freelancer dreaming of homeownership, you’re not alone in wondering, “Can freelancers get a mortgage?” The good news is that the answer is yes. In this comprehensive guide, we will explore the ins and outs of securing a mortgage as a freelancer, helping you navigate the sometimes complex world of freelance mortgages.

Can freelancers get a mortgage?

Absolutely! Freelancers can indeed get a mortgage in the UK. However, the process may differ from what traditional salaried employees experience. Lenders typically assess mortgage applications based on an applicant’s ability to repay the loan. For freelancers, this means demonstrating a stable income stream and good financial standing.

How to get a mortgage as a freelancer

Getting a mortgage as a freelancer may require a bit more effort compared to those with a traditional job. Here are some key steps to help you navigate the process successfully:
  1. Work with a Specialist Mortgage Broker: Freelancers often benefit from the expertise of a mortgage broker who specialises in freelance mortgage applications. These professionals can help you find lenders who are more likely to accept your application.
  2. Assess Your Income: Lenders will want to see proof of your income as a freelancer. Typically, they will consider your average income over the past two to three years. This means you should have detailed records of your earnings, including invoices, contracts, and bank statements.
  3. Build a Strong Credit History: A good credit history is essential for mortgage approval. Make sure your credit report is in good shape by paying bills on time and managing any outstanding debts.
  4. Save for a Deposit: Just like any other mortgage applicant, you’ll need a deposit. The larger your deposit, the better your chances of securing a mortgage with favorable terms.
  5. Be Prepared for a Larger Deposit: Freelancers may be asked for a larger deposit than traditional employees. This is because lenders may view freelancers as higher-risk borrowers due to the fluctuating nature of freelance income.

How Much Can You Borrow?

Determining how much you can borrow as a freelancer involves several factors, including your income, deposit amount, and the lender’s criteria. Below is a table example illustrating how much you might be able to borrow based on your annual income and a 15% deposit:

Annual Income Potential Borrowing Amount
£30,000 £120,000
£50,000 £200,000
£70,000 £280,000
£100,000 £400,000

Please note that this table provides a general estimate, and this is just a guide and subject to each lender own affordability calculations alongside the borrowers income and expenditure. 

How many months of freelance income do I need?

Lenders typically require freelancers to provide at least two to three years’ worth of income documentation. This helps them assess the stability and consistency of your earnings. The more proof of consistent income you can provide, the better your chances of approval.

Can I get a mortgage without 2 years’ tax returns?

While most lenders prefer to see two years’ worth of tax returns for freelancers, some specialist lenders may accept applications with just one year of accounts. However, this is generally the exception rather than the rule. It’s advisable to work with a mortgage broker who can connect you with lenders willing to consider your specific circumstances.

How much deposit do I need?

The deposit amount required for a freelance mortgage varies but typically falls within the range of 10% to 20% of the property’s purchase price. As mentioned earlier, freelancers may be asked for a larger deposit due to perceived higher risk. The larger your deposit, the more attractive you become to lenders.

How many times my freelance salary can I borrow?

Lenders typically use an affordability calculation to determine how much they are willing to lend. This calculation considers various factors, including your income, expenses, and credit history. As a rough guideline, lenders may offer you a mortgage of up to 4 to 4.5 times your annual freelance income.

How hard is it to get a mortgage as a freelancer?

Getting a mortgage as a freelancer can be more challenging than for traditional employees, but it’s certainly achievable. The key is to work with a specialist mortgage broker who understands the unique challenges faced by freelancers and can connect you with lenders who are more likely to approve your application.

Getting a mortgage as a freelancer with bad credit

If you have a less-than-perfect credit history, obtaining a mortgage as a freelancer can be more challenging, but not impossible. Specialist lenders who cater to individuals with adverse credit may be willing to consider your application. However, you may face higher interest rates and stricter lending criteria. To improve your chances, focus on improving your credit score and consider working with a mortgage broker experienced in dealing with bad credit applications.

In conclusion, while securing a mortgage as a freelancer in the UK may require more effort and preparation, it is certainly possible. By working with a specialist mortgage broker, managing your finances wisely, and building a strong credit history, you can increase your chances of achieving your dream of homeownership. Remember that every freelancer’s situation is unique, so it’s essential to seek personalised advice and explore all available options. If you have questions or need guidance, don’t hesitate to reach out to Ascot Mortgages, your trusted partner in the mortgage journey.

Alison Gibson is a seasoned mortgage expert at Ascot Mortgages, specialising in providing bespoke mortgage advice to professionals across the UK. To find your match and start your journey towards your ideal mortgage, you can reach out to us directly at 01925 711558 or send an enquiry through our website.

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