Agreement in Principle Self-Employed

How reliable is an Agreement in Principle? How long is an AIP valid if I’m self-employed and my income changes?

It’s as reliable as the information given. I always stress to my clients, if there’s anything that may negatively impact this, it’s much better for us to work around that from day one.

I always ask for those documents before I do the Agreement in Principle, just to make sure the income is accurate. Then the Agreement in Principle is as bulletproof as possible.

The time it’s valid varies depending on which lender we use. With some lenders, they’re valid for 30 days, while others are up to three months.

If you’re self-employed and your income changes, just make us aware, because we can always work around it. We might just approach a lender that takes a different view on it. The Agreement in Principle may change if you suddenly lose a client or you go from self-employed to employed, and your income changes. But there’s usually a lender who will offer you the same amount of borrowing – it’s just a case of switching over to them.

Will I need a credit check? Does an Agreement in Principle affect credit score?

You will need a credit check, but most lenders actually do a soft check, which won’t leave a footprint on your credit report. It doesn’t affect your credit at all. Some lenders might do a hard check. We will always get your consent before we progress with that.

How do I apply for an Agreement in Principle if I’m self-employed? How long does this take?

The first step is to speak to a broker like myself and my colleagues. An adviser will look at your business and your income and determine what’s best for you. The first stage is a fact-find, to get to know you as a person and understand your business. We’ll get your documents – your tax returns, limited company accounts, bank statements.

How long it takes is really down to the client. As advisers, we can get an Agreement in Principle in 15 or 20 minutes. We know the system and can get everything keyed in quickly.

The lengthy part of the process is gathering the right documents. It’s so important to just have those ready to send over so we can review them all.

How else can a mortgage broker help here?

Ultimately, we’re doing all the hard work for you. It’s great if you can be organised and prepared ahead of time.

We don’t just do your mortgage application. We help you through the whole process of buying a property, remortgaging or moving home. Whether it’s your first purchase or you’ve done this before, we’re here to guide you all the way.

Key Takeaways:

• Self-employed individuals can certainly get an Agreement in Principle (AIP); it is not necessarily harder than for an employed person, but the requirements are different.
• You will need at least one year’s trading books, which includes limited company accounts or sole trader tax documents (SA302s). This allows lenders to see a trend in your earnings.
• Most lenders calculate affordability by using an average of your income over the last two years from completed tax returns. However, they will always use the latest year’s income if it is lower than the previous year (a downward trend).
• The initial credit check for an AIP is typically a ‘soft check,’ which will not leave a footprint on your credit report or affect your credit score.
• A mortgage broker is crucial for choosing the right lender to suit your business. While brokers can issue an AIP in 15-20 minutes, the longest part of the process is the client gathering all the necessary documents (ID, bank statements, tax returns, etc.).

YOUR PROPERTY MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON YOUR MORTGAGE.

Approved by The Openwork Partnership on 28/01/2026.