Suffolk Building Society advise freelancers to look for ‘self employed’ mortgages

Ahead of National Freelancer’s Day on 16 June 2022, Suffolk Building Society is offering guidance to freelancers about what actions they can take to help qualify for a mortgage. While freelancers may operate under different business structures, such as being a sole trader or a limited company, mortgage lenders tend to group everyone together under a ‘self employed’ banner.

Suffolk Building Society’s Head of Mortgages, Charlotte Grimshaw, said: “Nowadays, many more mortgage providers are inclined to lend to freelancers than perhaps they once were. Some providers offer specific self employed mortgages, while others offer freelancers access to standard mortgage products, as long as they meet certain criteria.

“So if you don’t see any ‘freelance’ mortgage products it doesn’t necessarily mean the provider won’t lend to you.”

If an applicant is employed, much of mortgage lenders’ reassurance and comfort comes from payslips as it shows stability of employment and proof of earnings but as this isn’t feasible for freelancers, lenders will look at other ways to evidence work history and current employment status.

For most freelancers, this will mean providing evidence of contracts, company accounts or self assessment tax forms (SA302s).

Suffolk Building Society explains that in general, freelancers need to ensure their work and contracting history is comprehensive and up to date. This includes making sure that their online profile, on sites such as LinkedIn, is representative of their current work.

Charlotte Grimshaw explains: “As mortgage lenders, we’re not trying to catch people out - we really do want to help people buy their dream home. Whether an applicant is a freelancer or not, it’s all about looking for positive supporting evidence.”

Freelancers are not exempt from all the usual checks that lenders undertake for other applicants either, so it’s well worth them scrutinising their own credit report to make sure it’s clean and up to date i.e. all addresses are the same, credit repayments are correct and up to date, no County Court Judgements are present, etc.

Charlotte Grimshaw concluded: “The barriers that freelancers once faced in getting a mortgage are coming down, as lenders embrace different, and often multiple, sources of income.”