How to get a mortgage when you are self-employed

Navigating the world of mortgages as a freelancer or entrepreneur can feel like stepping into a maze of myths and misconceptions. In this article, the team at Mister Mortgage aims to clarify things by debunking the myths and giving you the right information to help you get a mortgage in the Netherlands.

What are the differences between freelancers and entrepreneurs?

First, it's important to differentiate between these two terms, as the requirements for each group can vary:

Freelancers

In the Netherlands, freelancers are known as ZZP'ers (zelfstandige zonder personeel, meaning "independent with no employees"). These self-employed professionals work independently, not as employees. Freelancers usually work based on a long or short-term contract with their clients. Typically, they run their businesses as an eenmanszaak, a one-person business structure.

Entrepreneurs

In the Netherlands, entrepreneurs who operate a private limited company are known as BV owners. A B.V. (Besloten Vennootschap) is a legal structure that self-employed individuals can choose for their business.

What are the requirements for getting a mortgage as a freelancer?

Several factors are important when applying for a mortgage as a freelancer, including income, job security, and future expectations. To qualify for a mortgage, you need at least 12 months of activity in your company and to have been registered at the Kamer van Koophandel (KvK), the Dutch Chamber of Commerce, for at least 12 months. The key requirement, however, is income history.

Determining income for freelancers is not as straightforward as determining income from employment. It is based on your average income over the previous three years. If your company has not been around for three years yet, your previous income from employment may also be taken into account.

Depending on the mortgage provider, your specific situation, and your employment / self-employment history, your options to get a mortgage as a freelancer may be more extensive than you realise.

What documents are required to start a mortgage application as a freelancer?

To apply for a mortgage as a freelancer, you need to provide the following documents to a mortgage lender:

• Annual report for the last three years (or less, if your company is less than three years old) 
• Tax returns for the last three years (or less, as above) 
• Year-to-date results for the current year
• Chamber of Commerce registration 
• Business forecast for the rest of the current year

What are the requirements for getting a mortgage as an entrepreneur?

The key requirement for beginning your mortgage application as an entrepreneur is providing annual reports showing the turnover for the past three years for each company you own. In addition to this, you also need to provide the following documents to the mortgage lender, for each company you own:

• Company tax returns for the last three years (or less, if your company is less than three years old) 
• Organisation chart
• Most recent salary slip
• Year-to-date results for the current year
• Chamber of Commerce registration
• Business forecast for the rest of the current year

What do you do if you have just started freelancing or running your BV?

If you are new to self-employment, that doesn't necessarily mean you won't qualify for a mortgage. Each bank has different requirements, so it’s a good idea to consult with a mortgage advisor. They can help by reviewing your information and negotiating with lenders. The final decision depends on the lender's policies.

How can a mortgage advisor help you if you are a freelancer or entrepreneur

A mortgage advisor can help you with the following things:

• They can give you an in-depth analysis of your financial situation to find the best mortgage solutions
• They have access to various lenders and products tailored for freelancers and entrepreneurs
• They can negotiate with lenders to secure favourable terms and conditions for your mortgage
• They can assist you with meeting varying lender requirements and adjusting to changes in your financial situation

The Mister Mortgage team provides mortgage solutions designed specifically for freelancers and entrepreneurs. Reach out to their mortgage specialists for expert, personalised guidance every step of the way. They're committed to transparency, integrity and growth, and are dedicated to helping you secure a bright financial future. Contact them today to start your journey!