Summary
Access Low-Rate Limited Company Director Mortgages Today!
Limited company directors on PAYE can get a clear, affordable mortgage. Lenders assess your PAYE salary and may also look at dividends, shareholding and company accounts. Even with a modest salary, routes exist that consider overall business strength. We explain how affordability is calculated for a mortgage for company director on PAYE, what evidence you’ll need, and how to structure your case for a smooth approval. CeMAP-qualified, FCA-regulated advisers. Rated 5★ with 2,500+ Trustpilot reviews and 5/5 on Google.
What you’ll get (quick overview)
Affordability methods: salary only, salary + dividends, or (with some lenders) salary + a share of retained profit.
Clear options: purchase, remortgage, borrowing more or porting.
Structure choices: repayment or part-and-part; interest-only may be available on part (policy varies by lender).
Cost clarity: rates, fees and true monthly impact explained in plain English.
Smooth process: step-by-step checklist and proactive case handling.
Soft eligibility review first; full checks follow only if you apply.
How it works
Underwriters consider your role, shareholding %, and income pattern. If you’re mainly PAYE, some lenders work from payslips and P60s. Others average salary and dividends over the last 2–3 years, or consider the latest year if trending up. A few may accept salary plus a proportion of company net profit. Loan-to-value (LTV = mortgage as a % of the price) and credit conduct influence the outcome. Exact rules and timings vary by lender.
Key criteria (high level)
Stable PAYE income, sensible credit history, suitable LTV and a sustainable monthly payment. Length of trading, company liabilities and recent performance also matter. Thresholds vary by lender.
Typical documents
Photo ID and address history, recent payslips and P60, personal and business bank statements, SA302s/Tax Year Overviews if dividends are used, and up-to-date company accounts or an accountant’s reference. Details of any existing borrowing.
Timings
Eligibility review can be quick. Full application to offer typically takes a few weeks. This varies by lender and case complexity.
When to speak to an adviser
- You draw a low PAYE salary and rely on dividends or retained profits.
- Your company has short trading history, a restructure, or variable profits.
- You want higher LTV, interest-only on part, or to borrow more on a remortgage.
- You were declined elsewhere or offered less than expected.
- You’re adding/removing a borrower or changing term/repayment type.
Trust & transparency
CeMAP-qualified advisers. FCA-regulated. UK-wide support. Rated 5★ with 2,500+ Trustpilot reviews and 5/5 on Google.
Your home may be repossessed if you do not keep up repayments on your mortgage.
Excellent service. As a sole director of a limited company, I expected to have to share an abundance of paperwork in order to secure my new mortgage. This was not the case.
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Save huge time and money, and let our specialists help structure the most suitable mortgage for your circumstances. You can base your mortgage on profits and not just dividends, meaning you have access to far more borrowing and better mortgage rates.
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Limited Company Director Mortgages – A Helpful Guide
As a Limited Company Director, much like other Self-Employed individuals, you will have many of the same mortgage options as more conventionally employed applicants. At the end of 2019, 15.3% of the UK population were classed as self-employed and the onset of Coronavirus pushed even more people to reconsider their employment options.
As the nation’s workforce changes, mortgage providers have had to change to accommodate more Self-Employed workers. There are even specialist lenders who deal solely in mortgages for the Self-Employed. The major difference for Self-Employed applicants lies in the application process, both with how lenders calculate your mortgage and the way that you prove your income.
FAQ’s for Company Director’s
No, retained profits are not typically considered as they reflect past income. It’s advisable to draw down profits to increase your assessable income before applying.
Yes, dividends can be included when calculating your mortgage loan amount. However, the amount considered cannot exceed the company’s net profits.
Even if you are on PAYE, you’ll still be classed as self-employed for mortgage purposes. Your income will be assessed using business accounts and SA302s, rather than just payslips.
You’ll need full accounts for the past three years, SA302 forms for the last three years, a tax overview from HMRC, and recent business bank statements. These documents help prove your income and the business’s financial stability.
Lenders usually take an average from your last two or three SA302s but prefer an upward trend in income. Decreasing income may limit borrowing potential to the most recent year’s figure.
Documenting Your Trading History
Although lenders’ requirements differ with regard to application requirements, all of them will want to see well-documented records of your business operations. The majority of lenders will expect you to have at least two years of trading history before they will consider a mortgage application.
Lenders who specialise in self-employed mortgage applicants may be willing to consider those with as little as one year’s trading history, but this will dramatically reduce your choice of lenders. To benefit from a wider range of lenders and a more competitive interest rate, it’s worth waiting an additional year before applying for a mortgage.
As a Limited Company Director, mortgage lenders will consider your individual salary and dividends from the business. They may also look at the business profits as a whole to ensure that your company can continue to support your salary. In order to prove your income, you will therefore need to provide:How Do I Prove My Income?
Brokers understand the nuances of director incomes and can help find suitable lenders and products. They can present your application positively and guide through documentation.
Lenders assess income by examining salary, dividends, and sometimes net profits. Full accounts and SA302 forms help in providing a comprehensive financial picture.
Yes, some lenders may accept one year of trading history, but it limits your options and possibly increases rates. Waiting until you have two or more years may provide better choices.
Eligible income includes salary, dividends, and sometimes the director’s share of net profits. Lenders may also consider the company’s overall performance.
A standard deposit is typically 10%, though a larger deposit can strengthen your application, especially if you have adverse credit.
What About Mortgage for Company Director on Paye?
Your salary will be taken into consideration, however, payslips are not a suitable form of evidence to support this and the documents listed above will be used to determine your salary. If you’re receiving a PAYE salary from your own business, you’re still classed as Self-Employed for the purposes of the mortgage application.
Dividends
Your dividend payments will be taken into consideration when calculating the mortgage loan amount, however, the amount must not exceed the net profits of the business.
Retained Profit
Whilst it is common and in most cases advisable practice to retain profits in the business, unfortunately, retained profits cannot be considered in the mortgage calculation. As retained profits reflect the income from previous years, lenders will not consider it as a current business performance measure.
If you’re planning to take a mortgage in the next few years, you may wish to consider drawing down more profits from your company in the few years prior to your application. This will increase your overall income for mortgage calculation purposes.
What If I Have a Fluctuating Income?
Most Self-Employed workers have at least some degree of fluctuation in their income. Where this is the case, lenders will take an average figure from your last two or three SA302s. They will, however, usually look for an upward trend over at least the last two years of trading.
Where your income is decreasing each year, the lender will only take your most recent year’s income into consideration, which means that your loan figure is likely to be lower.
Yes, but you’ll need to confirm the company operates as a property rental business to benefit from tax advantages and access specific products.
It depends on the lender. Some may choose to only consider salary and net profits, especially if there’s been an improvement in trading performance.
Typically, the process takes about a month, though this can vary based on the complexity of the financial profile and lender’s requirements.
Using the latest year’s profits may enhance borrowing capacity if it shows a better financial performance compared to previous years.
Having bad credit can make securing a mortgage more challenging, but some lenders specialize in such cases and offer customized options, often requiring a larger deposit.
Deposit
Ordinarily, there are no additional deposit requirements for Self-Employed applicants and a standard 10% deposit is required. Given that lenders are more cautious in current times, as a result of the effect Coronavirus has had on the property market, they are asking for Self-Employed applicants to increase their deposit amount slightly.
As a Self-Employed applicant, offering a larger deposit at any time can improve your chance of acceptance, as it reduces the risk to the lender and instills trust in your affordability. This is particularly applicable if you have a history of adverse credit.
Why Use the Mortgage Broker?
At The Mortgage Broker, it’s our vision to become the UK’s most trusted and respected mortgage broker. The only way for us to achieve this is by providing straightforward and transparent advice to every one of our clients.
From your first call to your last, we put customer service first before all else so you can be confident in getting expert mortgage advice.
Your home may be repossessed if you do not keep up repayments on your mortgage.
We offer FREE no-obligation advice with no hidden costs. Payment is only taken when we proceed with the application. Therefore if we don’t complete any business, the customer never pays a penny.
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