Can Accountants Get a Home Loan with One Year of Financials?
Key Takeaways
- Most lenders require two years of financial statements, but some will consider one year where specific criteria are met.
- A strong employment history in accounting together with an ABN registered for around two years improves eligibility.
- Using one year of financials can benefit accountants whose business has grown significantly, as averaging two years may reduce borrowing capacity.
- One-year policies usually have stricter lending requirements and are designed for particular circumstances rather than every applicant.
Many accountants who have recently started their own practice—or whose latest financial year is substantially stronger than the previous one—find themselves unable to satisfy the traditional two-year financial history required by most lenders. Waiting another financial year can delay purchasing a property or refinancing while interest rates continue to change.
Fortunately, some lenders are willing to assess self-employed accountants using only one year of financial statements when the circumstances support it. Knowing which lenders offer this policy and whether you qualify is something a mortgage broker for accountants can determine quickly.
This guide explains the standard two-year requirement, when a one-year pathway is available, the conditions lenders apply, and when using one year of financials can actually improve your borrowing position.
The Standard Two-Year Rule
Most lenders ask self-employed borrowers to provide two years of business financial statements together with personal and business tax returns. They typically assess income using either the lower of the two years or an average of both years.
The purpose is to demonstrate that income is stable and sustainable rather than the result of one unusually successful year. For accountants who have operated their own practice for several years this is usually straightforward. Challenges arise when the business is relatively new or when the latest financial year is substantially stronger than the year before.
When a One-Year Pathway Is Available
Some lenders will assess a self-employed accountant using only one year of financials, but only for applicants who meet specific criteria.
This commonly applies to accountants who spent many years employed before establishing their own practice. Lenders recognise that their earning capacity and professional experience existed well before becoming self-employed.
It may also suit growing businesses where the latest financial year provides a more accurate reflection of current income than averaging two years would.
Importantly, this remains a full-documentation loan requiring tax returns and financial statements rather than a low-doc loan.
The Criteria Lenders Apply
Relevant Prior Experience
Lenders generally expect applicants to have an established history working within the accounting profession before becoming self-employed.
Business Establishment
Many lenders still require an ABN that has been registered for around two years together with evidence that the business is actively trading.
A Strong Financial Result
The financial year being assessed should demonstrate consistent profit, reliable income and properly prepared financial statements that support the requested borrowing.
When One Year Helps—and When It Doesn’t
One-year financial assessments work best for businesses experiencing strong growth because they reflect current earnings instead of averaging earlier, weaker years.
They can also help accountants who have only recently become self-employed by allowing them to borrow sooner instead of waiting another financial year.
However, if the latest financial year is weaker than the previous one, using only one year may reduce borrowing capacity. Lenders also continue to assess affordability using the actual interest rate plus APRA’s 3% serviceability buffer.
How This Fits with Professional Concessions
One-year financial assessments and professional lending benefits are separate policies, although eligible accountants may qualify for both.
Members of recognised professional organisations such as CPA Australia, Chartered Accountants Australia and New Zealand (CA ANZ), and the Institute of Public Accountants (IPA) may still qualify for Lenders Mortgage Insurance (LMI) waivers, potentially saving more than $20,000 on higher-LVR loans.
Additional lender conditions may apply where both the one-year policy and higher-LVR professional lending benefits are used together.
Frequently Asked Questions (FAQs)
Do all lenders require two years of financials?
Most lenders do. However, some will assess self-employed accountants using only one year of financial statements where specific eligibility criteria are satisfied.
Who is most likely to qualify with one year?
Accountants with extensive industry experience who have recently become self-employed, or businesses showing significant growth in their latest financial year.
Is a one-year assessment the same as a low-doc loan?
No. One-year assessments still require full financial documentation including tax returns and financial statements. Low-doc loans use alternative income verification methods.
Will using one year reduce how much I can borrow?
Not necessarily. For growing businesses it may increase borrowing capacity, while businesses with declining income may benefit more from a traditional two-year assessment.
Do I still need my ABN registered for two years?
In many cases, yes. Even lenders accepting one year of financials commonly expect an ABN that has been active for around two years.
Can I still receive the LMI waiver?
Generally yes, provided you hold membership with an eligible professional accounting body and meet the lender’s professional lending criteria.
The Bottom Line
Obtaining a home loan with only one year of financial statements is possible for many accountants, but it is designed for particular situations rather than every applicant. Lenders typically look for strong professional experience, an established business, approximately two years of ABN registration and well-documented financial results.
Where appropriate, a one-year assessment can allow accountants to borrow sooner while still accessing professional lending benefits such as LMI waivers. Matching your circumstances with the right lender is the key to making this pathway work.
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