Starting your own business is a major milestone, but for many newly self-employed professionals it quickly raises a familiar concern: can I get a mortgage with only 1 year of accounts? Many assume they must wait 2 years before a lender will consider them, but a mortgage with 1 years accounts may be possible with the right lender and supporting evidence.

While many mainstream lenders do insist on a longer trading history, the UK mortgage market also includes specialist providers who are willing to consider a mortgage with 12 months trading history. Rather than relying purely on historic averages, these lenders look at factors such as continuity in the same profession, prior employed experience, and evidence that income is sustainable beyond the first year.

This guide explains how a mortgage with 1 year accounts really work, which lenders are more flexible, and what evidence you’ll need to support your application. If you’ve recently become self-employed you may find there are more options available than you expect.

Lender Flexibility for a Mortgage with 1 Years Accounts

For self-employed applicants, the length of trading history plays a key role in how income is assessed; but it isn’t always an automatic barrier. Most lenders define someone as self-employed if they hold 20%, 25% or more of a business, whether operating as a sole trader, in a partnership, or as a limited company director. This classification determines what documentation is required and how strictly income is scrutinised.

Many high street lenders apply a firm rule that trading history must span at least 2 years, and applications with less than 24 months’ accounts are often declined without further review. However, a growing number of specialist lenders take a more flexible approach, particularly where the business is stable and the applicant has relevant experience.

For example, Aldermore may consider applications with just 1 year’s accounts, offering borrowing up to 90% LTV (excluding fees). This is supported by evidence of guaranteed or contracted income for the following accounting period, or by management accounts covering the first 6 months of the current year.

Similarly, The Mortgage Lender (TML) offers specific products designed for applicants trading between 12 and 24 months, with maximum lending of up to 90% LTV. Hinckley & Rugby’s Income Flex range can accept applicants with only 1 year’s accounts or SA302s, even where profits have declined, with borrowing capped at 80% LTV.

Some mainstream lenders will consider exceptions as well. Metro Bank, for example, may consider a mortgage with 12 months trading history, although standard policy still favours 2 full years of accounts.

Income Calculation: Using Latest Figures and Projections

When assessing a 1 year accounts mortgage, lenders need to be confident that the income shown is sustainable. Rather than relying on 2 or 3 year averages, more flexible lenders focus on the most recent performance of the business, and in some cases, its projected income for the current year.

For many lenders, the starting point is the latest completed financial year. If that first year shows stable or improving income, it may be used on its own rather than being averaged with earlier figures that don’t exist. Some lenders go a step further by allowing a mortgage with accountant projections for the second year of trading.

For example, Afin Bank typically requires the business to have completed its first full year and to be at least six months into the second. In these cases, affordability it typically calculated using 90% of the forecasted income for year two, provided the applicant has a qualified accountant.

Other lenders remain more cautious. The Stafford Building Society will consider projections only where the business has been trading for at least 2 years. The Society also may still rely on the most recent year’s income if there is a clear and plausible explanation for growth.

Required Documentation and Accountancy Standards

Applications for a 1 year accounts mortgage are usually more document-heavy due to the limited trading history. Lenders need to see clear, consistent evidence that the income declared is accurate and that the business is operating successfully beyond its first year.

While requirements vary by lenders, self employed mortgage criteria typically consists of:

• Tax Calculations (SA302s) and corresponding Tax Year Overviews, where available.
• Certified accounts for the most recent financial year, signed by a qualified accountant.
• Business bank statements, usually covering the latest 3 to 6 months, to evidence ongoing trading.
• Personal bank statements, to support affordability and confirm income drawings.

For example, The Mortgage Lender (TML) accepts applications from those trading for 12-24 months using the most recent year’s certified accounts or SA302s, alongside the matching Tax Year Overview and the latest three months’ business bank statements. Importantly, TML does not accept a mortgage with accountant projections on its own.

Both Aldermore and Hinckley & Rugby require 1 year’s accounts or SA302s, with Aldermore also expecting evidence of previous employment or guaranteed income. Providers such as Dudley Building Society and TML also impose limits on how old the accounts can be, where the most recent financial year-end must typically be no more than 18 months old at the point of application.

Key Constraints: Credit, Debt and Loan Purpose

While lenders who accept a self employed mortgage with 1 year’s accounts are more flexible on income history, that flexibility is usually balanced with tighter controls elsewhere. Understanding these constraints early can help avoid unnecessary declines.

• Loan Purpose Restrictions: Capital raising, particularly for debt consolidation is often restricted for applicants relying on limited accounts with many lenders capping borrowing at lower LTV levels. Aldermore caps remortgages with capital raising for non-property related purposes at 85% LTV, while Accord Mortgages restricts debt consolidation remortgages to 85% LTV (for high credit scores) or 80% LTV (for standard scores).
• Property Ownership: Some lenders require the property to have been owned for a minimum period (often between 6 to 12 months) before a remortgage is considered, which can affect applicants looking to refinance shortly after purchase. The Mortgage Lender requires customers to have owned the property for a minimum of 12 months before remortgaging.
• Credit History: Defaults, missed payments, or CCJs are assessed carefully, and while adverse credit does not automatically rule out an application, it can reduce the maximum LTV available or push the case into a more specialist lending tier. Aldermore, for example, will consider applicants up to 80% LTV even if they have CCJs or defaults registered in the last 6 months.

The Distinction Between High Street & Specialist Lenders

When applying for a self-employed mortgage with 12 months trading history, the difference between high street and specialist lenders is often crucial. The general consensus is that high street lenders will decline a mortgage with 1 years accounts whereas specialist lenders will use manual underwriting to assess the sustainability of the application.

High street lenders (such as Santander or TSB) typically rely on automated affordability models and rigid income verification rules. For most mainstream banks, two years of SA302s or finalised accounts is a minimum requirement, and applications falling short of this are usually declined without discretion. Even where exceptions exist, they tend to be limited and inconsistently applied.

Specialist lenders, by contrast, are designed to work in this space. They use manual underwriting to assess the broader picture rather than relying solely on historic averages. This allows them to consider self employed mortgage criteria such as:

• Continuity in the same industry or profession
• Strong performance in the first year of trading
• Accountant prepared projections supported by current trading evidence
• Business and personal bank statements that demonstrate sustainability.

Lenders such as Aldermore, The Mortgage Lender, and Hinckley & Rugby have specific self employed mortgage criteria for applicants with less than 2 years of trading history, with maximum LTVs ranging from around 70% to 90% depending on the strength of the application. This approach recognises that a shorter trading history does not necessarily equate to higher risk when the underlying income is stable and well-evidenced.

This is where a specialist broker adds real value. Knowing which lenders will accept 1 year’s accounts, what documentation they require, and how to position the application can be the difference between a straightforward approval and a declined case. Criteria in this area changes frequently, and working with lenders who understand new businesses is essential for applicants at this stage of their self-employment journey.

Is a Mortgage Possible with Only 1 Year’s Accounts?

A mortgage with 1 years accounts can be achievable when the application is matched to the right lender and supported by clear, up-to-date evidence. While a large number of high street lenders still require two full years of trading history, a growing number of specialist lenders are prepared to look beyond this; provided the business shows clear sustainability, continuity within the same industry, and the right supporting evidence.

The key is understanding how different lender assess risk. Factors such as income stability, the quality of your accounts, projected earnings, credit history, and loan purpose all play a role in determining how much you can borrow and at what Loan-to-Value. With the right lender, it is possible to achieve a self employed mortgage even with a shorter trading history.

Because criteria in this area can vary widely and change frequently, professional guidance can make a meaningful difference. AALTO Mortgages regularly works with lenders who offer flexible criteria for a newly self-employed applicants, such as Aldermore and The Mortgage Lender, who understand that a new business isn’t necessarily a high-risk business. Talk to AALTO today to help identify the most appropriate route forward, tailored to your income structure and trading history.