How Mortgage Lenders View Digital Nomads

Mortgage lenders see digital nomads – people who work remotely and earn money online while travelling – as self-employed. 

With an estimated 35 million people now identifying as digital nomads, mortgage lenders are increasingly adapting their criteria to accommodate this growing demographic. 

However, this lifestyle offers flexibility at the expense of potential income irregularity and less job security compared to traditional employment.

This means you’re still seen as a risky borrower. Financial stability and reliable income remain key for mortgage approval. 

So as a digital nomad, you’ll need to prove your income is steady and sufficient to cover mortgage repayments.

What Paperwork Do Lenders Want from the Self-Employed?

The biggest hurdle digital nomads face is proving their income. 

Without payslips from an employer, lenders want to see paperwork that can verify your earnings. You’ll typically need:

  • 2-3 years of full accounts prepared by a chartered accountant
  • Your SA302 tax calculation forms or tax year overviews from HMRC
  • Contracts or evidence showing future projected income

While some lenders may accept accounts you prepared yourself, having an accountant certify your earnings looks far more professional and lenders place higher trust in third-party verification.

How Can I Improve My Credit Rating for a Mortgage?

In addition to income documentation, lenders will thoroughly assess your credit rating when making a lending decision. 

Do everything possible to maximise your credit score including:

  • Check your report for any errors and resolve them
  • Pay all bills and debt payments on time
  • Register on the electoral roll at your current UK address
  • Avoid applying for other new credit in the months before your mortgage application

A good credit history signals to the lender you are a responsible borrower. Having a high score opens up access to the most competitive mortgage rates.

Should I Pay a Bigger Deposit as a Digital Nomad?

Being self-employed often means putting down a larger deposit than someone with a permanent employment contract. Lenders see you as a higher risk, so putting down a bigger upfront payment helps offset that.

While some lenders may approve mortgages with 10-15% deposits for the self-employed, if you can stretch to a 20-25% deposit you’ll have many more options and better rates to choose from. 

Consider using government schemes or gifted deposits from family to boost your savings.

How Do Lenders Calculate Income for the Self-Employed?

Lenders will go through your accounts line-by-line to calculate your acceptable income for mortgage purposes. They’ll take your net profit from your most recent years then analyse:

  • If you operate as a sole trader/freelancer, they’ll use your total net profit
  • For partnerships, they’ll look at your specific profit share
  • If you run a limited company, they’ll consider both your salary and dividend payments

However, an accountant may have minimised your reported profits to reduce your tax liability. This “zinging” tactic often backfires for mortgage applications when it makes your income appear lower.

Should I Avoid Gaps Between Contracts Before Applying?

The flexibility of digital nomad life is a major draw – taking time off between contracts to recharge or go travelling. However, lenders want to see a consistent, reliable flow of income.

In the 6-12 months leading up to your mortgage application date, do your best to minimise any gaps in your work history. 

Be prepared to explain any extended breaks to underwriters and how you’ll maintain household payments.

While a wandering lifestyle suits the digital nomad path, mortgage lenders prefer applicants who display financial diligence.

Should I Use a Specialist Mortgage Broker?

The self-employed path to homeownership has more hurdles, so using an experienced broker who specialises in mortgages for freelancers and contractors can pay dividends.

Not only can they match you to appropriate lenders, but a broker will ensure you avoid any mistakes during the application process that could lead to rejection and a damaging mark on your credit file.

What Types of Mortgages Suit Digital Nomads?

Knowing your mortgage options is crucial. Here’s a breakdown of some common types:

  1. Fixed-Rate Mortgages – These offer a stable interest rate for a set period, usually 2, 5, or 10 years. They provide predictability in monthly payments, which can be beneficial if you prefer financial stability.
  2. Tracker Mortgages – These track the Bank of England’s base rate, meaning your payments can fluctuate. This type may suit digital nomads with flexible incomes who can manage potential changes in their monthly payments.
  3. Offset Mortgages – These link your savings account to your mortgage, allowing you to reduce the interest you pay. This can be a good option if you have substantial savings and want to reduce your overall mortgage cost.
  4. Interest-Only Mortgages – You pay only the interest initially, with the principal due at the end of the term. This might suit those with variable income who anticipate increased earnings in the future, but it requires a solid repayment strategy.

How International Income Affects Your Mortgage

Earning foreign income as a digital nomad can make getting a mortgage trickier.

Because exchange rates can change, foreign income might not be steady enough for regular mortgage payments. 

To convince lenders you’re a good risk, be prepared to show them how you manage this issue.

You’ll need to provide detailed documents proving your international income, like bank statements, work contracts, and tax records. 

Clear and consistent financial records are essential.

Some lenders specifically deal with mortgages for expats or people with international income. They understand foreign earnings and can offer suitable options. A mortgage broker can help you find these lenders.

Best Steps for Digital Nomads to Get a Mortgage

Here’s a checklist of the ideal steps for digital nomads seeking a mortgage in the UK:

✅ Have at least 2 years of accounts prepared and signed off by a chartered accountant.

✅ Boost your credit score into the highest tier by paying bills on time, updating the electoral roll, and avoiding any negative events.

✅ Save as big of a deposit as possible – 25% or more gives the most options.

✅ Be ready to explain any gaps or decreases in your income over the years.

✅ Provide evidence of future, reliable contracts in your pipeline.

✅ Use a specialist mortgage broker who works with self-employed applicants.

While getting a mortgage approval doesn’t quite have the same freedom as being a digital nomad, following these steps allows you to achieve that all-important life milestone of buying your own home.

The Bottom Line

Owning a home as a digital nomad is definitely possible, but it takes some planning. 

Here’s the key: prove your income is steady, build a good credit score, know your mortgage options, and find a mortgage broker who specialises in helping the self-employed.

With these steps, you can enjoy the freedom of your lifestyle and become a homeowner too.

Need a broker? Get in touch. We’ll connect you with a qualified mortgage broker who can help you get a mortgage as a digital nomad.