How to apply for a home loan when you are self-employed

South Africa's #1 independent property portal

The additional criteria for self-employed buyers are understandably daunting, however, with the guidance of knowledgeable and experienced property finance specialists and property practitioners, it’s possible to seamlessly navigate the potential administrative minefield. that acquiring your dream home entails.

As with any home loan application, the best is to be prepared with a deposit, and for those that are self-employed the bigger the better.

Major banks vary slightly in their evaluation criteria when a bond application is made by a person who is self-employed, but the common requirement is proving that there is a steady income and that about 30% of the average net income can be used to service a home loan.

If the applicant is divorced and maintenance is part of the regular income to be included in the earnings to be able to qualify for a bond, a copy of the divorce decree stating this should be included.

If there are any lease agreements where income will be included in the income statement of the applicant, the rental amount must be current and not predicted future amounts. Some of the banks ask for copies of lease agreements in place or rental schedules.


Start by ensuring your paperwork is in order before you even consider applying for a bond, as it will save you a lot of time and hassle once the process is set in motion.

Requirements can vary according to the application and the loan amount requested, but self-employed buyers will generally need to provide the following:

  • Comparative financials covering a trading or working period of the latest two years;
  • A letter from their auditor confirming personal income;
  • If their financials are more than six months old, the bank will need up-to-date signed management accounts;
  • A cash-flow forecast for the ensuing 12 months;

• A personal statement of assets and liabilities;

  • Personal and business bank statements;
  • Their latest IT34, which is confirmation from SARS that their tax affairs are in order;
  • Their company, closed-corporation (CC) or Trust statutory documents;
  • The ID documents of all their business’s directors, members or trustees;
  • Depending on the complexity of their application, it may also be useful to provide a short CV.

Tax affairs

Make sure all your tax affairs are in order. Outstanding tax returns, of whatever nature, will have a detrimental impact on the outcome of your home loan application.

Consider recruiting the services of a tax consultant or professional accountant if you need to as they can advise on how to best go out ensuring your tax is in order and creditworthiness is in good standing.

Credit record

A clear credit record is the foundation of sound personal financial management, and one of the first things that will be scrutinised when you apply for a home loan.

Bad credit, which typically results from defaulting on payments and loans, filing bankruptcy and unpaid judgements, decreases your chances of having your credit application approved.

All South Africans are granted one free credit check a year so it is advisable to that before putting the application process into motion. There is no need to panic if your credit record is unfavourable as it is possible to restore it to good health. A certified debt counselor can assist with this.

Potential Pitfalls

Potential pitfalls for self-employed applicants are where their financial statements are outdated and they do not have up-to-date management accounts; where they have not kept their personal expenses separate from their business expenses; where their financial and tax affairs are not in order.

Home Loans Property News
Property Watch - 3 Properties for sale in Pretoria
Featured Property
Property Watch - 3 Properties for sale in Pretoria
25 May 2023
Pretoria remains one of the most accessible South African cities for buyers across all price bands because it offers a wide selection of property types, including security complexes and estates. In addition, it boasts highly desirable leisure and lifestyle options, outstanding medical facilities, excellent schools, and first-class tertiary education, including the University of Pretoria, the University of South Africa, and the Tshwane University of Technology.
read more
Should I fix the interest rate on my bond?
Market & Opinion
Should I fix the interest rate on my bond?
22 May 2023
Homeowners and future home buyers often consider fixing the interest rates on their home loans - and with concerns about inflation and rising living costs, this has become a hot talking point once again.
read more
Solar tops the list of features home buyers seek
Market & Opinion
Solar tops the list of features home buyers seek
17 May 2023
As ongoing loadshedding starts to bite deeper and electricity tariffs rise inexorably, interest among home buyers in properties with energy-saving features is picking up considerably. This is according to a survey (with 384 respondents) recently conducted among its agents by national real estate agency, Pam Golding Properties.
read more
What you need to know about buying versus renting a home
Market & Opinion
What you need to know about buying versus renting a home
09 May 2023
Buying a home is a significant decision that requires careful consideration of various factors. When deciding whether to buy a home or whether you should rent, it's essential to evaluate all the pros and cons of both options before you make your decision.
read more
Real Estate Tools
Get pre-qualified
Make offers with confidence knowing what you can afford. Then shop for the best home loan
Bond Calculator
Calculate the estimated repayments on a home loan and savings with extra payments