Self-Employed: Mortgage with 1 Year's Accounts

Find out how to get a mortgage with just 1 year's self-employed accounts — which lenders accept it, what documents you need, and how LTV affects your options.

Self-Employed Mortgage with 1 Year's Accounts: What You Need to Know

If you've been self-employed for just over a year and want to get a mortgage, the good news is that you don't have to wait until you have two or three years of accounts behind you. A number of specialist and building society lenders will consider applications based on just one year's accounts — but the criteria varies significantly between them, and the options available to you will depend on factors like your loan-to-value ratio, your employment history before going self-employed, and the strength of your documentation. This guide explains what to expect, what lenders typically look for, and how to give yourself the best chance of a successful application.

Can you really get a mortgage with only 1 year's accounts?

Yes — but it takes the right lender. Most mainstream banks default to requiring two years of self-employed accounts as a minimum, which means they'll decline you at the first hurdle if you've only been trading for 12 to 18 months. However, a growing number of specialist lenders and smaller building societies have criteria that specifically accommodate applicants with just one year's trading history.

What those lenders look at instead is the whole picture: how your income has been earned, what documentation you can provide, whether your business appears sustainable, and — crucially — how much you're borrowing relative to the property's value. That ratio is known as loan-to-value, or LTV (the mortgage amount expressed as a percentage of the property's purchase price or valuation).

How lenders typically assess your income with 1 year's accounts

When only one year of accounts is available, lenders generally want to see one or more of the following:

• Finalised accounts prepared by a qualified accountant — this usually means someone holding a recognised professional qualification (ACA, ACCA, CIMA, CIPFA or similar). Some lenders won't accept an accountant's certificate alone and insist on formal accounts.
• SA302s and Tax Year Overviews — these are documents from HMRC confirming your declared income. An SA302 is the tax calculation summary produced when you submit a self-assessment tax return.
• Business and personal bank statements — typically the last three months of business bank statements and at least one month of personal statements, to show active trading and income flow.
• An accountant's projection — some lenders will also ask your accountant to confirm, in writing, that they expect your income to be maintained or to grow in the year ahead. This carries significant weight when accounts are limited.

For limited company directors, the approach can differ slightly — many lenders look at salary plus dividends drawn, and some also consider retained profits within the company. If you're a sole trader or in a partnership, lenders typically look at your share of net profit.

Does your LTV affect your chances?

Significantly, yes. Across the lenders who do accept one year's accounts, many apply a cap on the LTV they'll lend to. Common thresholds include:

• Up to 80% LTV for standard one-year account applications
• Up to 85–90% LTV on specialist products, subject to stricter criteria
• Some lenders require a minimum of two years' trading history for applications above 85% LTV

In practical terms, this means having a larger deposit — at least 15–20% of the purchase price — tends to open more doors when you're working with limited account history.

Does it help if you were employed in the same industry before going self-employed?

Often, yes — and this is one of the most important things to understand about how these lenders think. Several lenders who would normally require two or more years of accounts will relax that requirement if you can demonstrate a continuous career in the same profession before switching to self-employment.

For example, a lender may accept one year's self-employed accounts plus two years of P60s (annual summaries of employment income and tax deducted) as evidence of a consistent income pattern. The logic is straightforward: if you've spent five years as a plumber employed by a firm, and you've now gone self-employed doing the same work, lenders see less risk than if you've launched into a completely new industry.

Some lenders extend this further — if you transitioned from employment to self-employment within the same profession very recently, they may consider your application even before a full year of self-employed accounts is in place, particularly if you can provide year-to-date income figures verified by an accountant.

What if you're a contractor rather than a traditionally self-employed sole trader?

Contractors — people working through a limited company or on fixed-term contracts — are often assessed differently to sole traders, and some lenders use day rate or annualised contract rate rather than accounts to determine income. If this applies to you, it's worth exploring Greywood Financial's contractor mortgage guidance, which covers the specific criteria that apply to this type of employment arrangement.

Speak to a Broker
If you've been self-employed for around a year and aren't sure whether you'll qualify for a mortgage, it's worth having a conversation with an adviser before you apply anywhere directly. Greywood Financial's advisers regularly help self-employed clients navigate one-year account applications — including matching them to the right lender based on their specific income type, deposit size, and account documentation. Get in touch to find out where you stand.

What about the latest year's accounts — does the timing matter?

Yes, and this is a detail that catches many applicants off guard. Some lenders treat accounts as outdated if they're more than 12 months old. If your accounts were finalised some time ago and a significant period has passed since the accounting year ended, certain lenders will ask for additional supporting evidence — such as recent bank statements — to show that you're still actively trading at a similar level. A handful of lenders apply a maximum age of 18–21 months on filed accounts before they require supplementary documentation.

The takeaway: if you're approaching the end of a tax year, it may be worth waiting until your latest set of accounts is completed before applying — especially if your most recent year shows stronger income than the previous one.

What documentation should you prepare?

While every lender has its own checklist, you'll generally want to have the following ready:

• One year's finalised accounts (prepared and signed by a qualified accountant)
• SA302 tax calculation and Tax Year Overview from HMRC
• Three months' business bank statements
• One to three months' personal bank statements
• Proof of current trading (e.g. recent invoices, contracts, or client correspondence)
• Previous P60s if applicable (particularly valuable if you transitioned from employment)
• Accountant's projection letter if requested by the lender

Having these documents organised before you approach a lender — or a broker — speeds up the process considerably and reduces the risk of delays once an application is underway.

Is it worth using a broker for a one-year account mortgage?

Honestly, yes — particularly in this situation. The lenders who accept one year's accounts are not always the ones advertising prominently on comparison sites. Many are smaller building societies or specialist lenders who deal primarily through mortgage brokers rather than directly with the public. A broker with access to the full market can identify which lenders are most likely to accept your specific situation, at what LTV, and with what documentation — before any application is made and without leaving a mark on your credit file.

Applying to the wrong lender can result in a declined application that shows up on your credit history, which can then complicate future applications. Getting the right match first time matters.

Frequently Asked Questions

Can I get a mortgage if I've only been self-employed for 1 year?

Yes. A number of specialist lenders and building societies will consider applications from self-employed applicants with just one year's accounts. You'll typically need finalised accounts prepared by a qualified accountant, an SA302 from HMRC, and bank statements. Your chances are stronger if you have a deposit of at least 15–20%, and even better if you were previously employed in the same industry before going self-employed.

What documents do I need for a self-employed mortgage with 1 year's accounts?

Most lenders will want to see: one year's finalised accounts signed off by a qualified accountant, your SA302 tax calculation and Tax Year Overview from HMRC, three months of business bank statements, and at least one month of personal bank statements. Some lenders also ask for an accountant's projection letter confirming expected future income. If you moved from employment to self-employment in the same field, previous P60s can also help.

How much can I borrow if I only have 1 year's accounts?

This depends on the lender and your specific circumstances. Many lenders who accept one year's accounts cap the loan-to-value (LTV) at 80%, meaning you'd need at least a 20% deposit. Some specialist lenders will go higher — up to 85–90% LTV — but this typically comes with stricter criteria. The amount you can borrow is also based on your income as shown in your accounts, usually calculated as a multiple of your net profit (or salary plus dividends if you're a limited company director).

Does it help if I was employed before going self-employed?

Yes, in many cases. Several lenders who would normally require two or more years of self-employed accounts will accept just one year if you can show you were previously employed in the same profession. Evidence such as P60s from your employed years — usually the last two — can be used alongside your one year of self-employed accounts to support the application and demonstrate income continuity.

Will applying for a mortgage affect my credit score if I've only got 1 year's accounts?

A full mortgage application involves a hard credit search, which does leave a footprint on your credit file. If you apply to an unsuitable lender and are declined, this can make subsequent applications harder. That's why it makes sense to speak to a broker first — they can assess your situation, identify lenders whose criteria you meet, and carry out soft searches (which don't affect your credit score) before any formal application is submitted.

Getting a mortgage with just one year's accounts is genuinely possible — but it requires the right lender, the right documentation, and ideally some guidance on structuring your application. If you're ready to explore your options, speaking to an adviser who understands the self-employed market is the clearest next step you can take.

Your home may be repossessed if you do not keep up repayments on your mortgage. Greywood Financial Ltd is an Appointed Representative of PRIMIS Mortgage Network, a trading name of Advance Mortgage Funding Ltd. Advance Mortgage Funding Ltd is authorised and regulated by the Financial Conduct Authority. The guidance contained within this article is subject to the UK regulatory regime and is therefore primarily targeted at consumers based in the UK. Most Buy-to-Let mortgages are not regulated by the Financial Conduct Authority. Greywood Financial Ltd is registered in England and Wales, Company No: 12713768. Registered Office: 124 City Road, London, EC1V 2NX.