The importance of self-employment

Did you know that there are 2.9 million self-employed workers in the UK, contributing an estimated £366 billion to the UK economy in 2024?

There were as many as 3.5 million people working for themselves in 2019, but the impact of the COVID pandemic saw this fall to 2.8 million by the end of 2022.

While the overall number of self-employed people is starting to grow again, the type of work they do is changing, with a shift away from traditional trades. More people are freelancing or contracting, while others are working multiple roles or adding a side-hustle to their existing day job.

• People with a second job has increased by almost 150,000 since January 2020 to over 1.3 million by September 2025, and now accounts for 3.9% of all people in employment
• There were also 460,000 side-hustles as of February 2024, 20% higher than 2023 and accounting for 11% of all solo self-employment.
• According to a report by IPSE, the Self-Employed Association, last year there was a 4% increase in self-employed administrative and secretarial workers; a 2% growth in managerial freelancers; and a 2% growth in people in professional and technical occupations working for themselves.
• There was also a huge 29% increase in self-employed people working in caring, leisure and other service occupations compared with 2023.
• By comparison, the IPSE report found that the number of self-employed people in skilled trades fell by 4% from 2023 to 2024; those working in sales and customer services occupations dropped by 10%; and the number of people working for themselves in lower-skilled elementary occupations fell by 8%.

A healthy self-employment sector is good for the economy, however, being self-employed or having multiple sources of income can be challenging for borrowers looking to get a mortgage. Mainstream lenders often want to see several years of accounts, or they struggle with applicants with more complex incomes.

We asked 500 self-employed workers what barriers they faced trying to get a mortgage. This is what they told us:

• 26% of people we spoke to believed they had been turned down for a mortgage because they were self-employed
• 23% believed their unpredictable earnings or fluctuating income had been an issue
• 9% believed they had been turned down because the lender would not accept multiple income streams
• 13% believed that insufficient proof of earnings or not enough years of accounts had been a barrier

It’s no wonder that three-quarters of the people we surveyed said they would consider switching to a salary-based role if it made getting a mortgage easier.

Afin’s mortgages have been created to help overcome these problems. For example:

• Applicants must have completed at least their first full financial year of trading and provide their first set of filed accounts. Projections or forecasted accounts for the second year and beyond may be considered, provided they are prepared by a qualified accountant and the business is at least six months into its current trading year.
• We will consider forecasted income when supported by an accountant, which could help you in the early years of self-employment.
• For contractors, including those on a day-rate, we’ll consider applications at the start of your contract if you have two years of relevant industry experience in the UK or internationally.

For qualified professionals we also offer mortgages of up to 95% Loan To Value and up to 6.5 times your income. If you are a qualified professional from overseas working in the UK on a valid work visa, you can apply for a mortgage after only six month’s residency in the UK.

How can we do this when other lenders cannot? Afin is different because we treat every customer individually, to get a real understanding of your personal and financial circumstances to offer you the right mortgage, rather than using an automated process like most big lenders.

Afin Bank was created to support underserved borrowers like you and help you get the mortgage you need to get a home of your own. So, if any of these challenges getting a mortgage ring true with you, then you should have a chat with Afin Bank.