Growing numbers of New Zealanders are opting for self-employment: the World Bank estimates that over 17% of the population are currently self-employed and Stats NZ says this equates to over 300,000 workers.

However, many self-employed people struggle to provide banks with the necessary financial records to secure basic financial products like mortgages.

Pope & Co Mortgages director Craig Pope says the challenge for self-employed people is that they often don’t have up-to-date financials.

“Or they may be newly self-employed and haven’t built up a long enough track record. This makes it difficult for a bank to make a proper assessment.”

But, alongside the growth in self-employment or “independent earners”, there has been a rise in products and services catering to the new ways of working. One of these is Hnry, an end-to-end tax service.

Hnry chief executive James Fuller says that many self-employed people earn a consistent income but freelancers and contractors are viewed as riskier as they don’t have a permanent or salaried job.

That makes it tough for them to gain access to mortgages, loans, insurance and investment opportunities.

“Ask any bank or mortgage adviser who the most difficult clients are – it’s those who are self-employed, and it’s not because they don’t earn good money,” Fuller says.

“It’s because the way credit providers assess applications does not easily accommodate ‘non-standard’ income. Often it’s the self-employed who pay higher interest rates on credit due to this fact.”

That’s where Hnry can help as it enables self-employed people to compile comprehensive financial information which they can use to access financial products like mortgages, loans and insurance.

Pope says that securing a mortgage is all about knowing what information the banks will request and being prepared well in advance.

“On the whole, for a mortgage application for example, banks prefer a good two-year financial history. If the deposit or equity is more than 20%, then one full year of financials may be sufficient.”

“A service like Hnry could make it much easier for independent earners to provide good financial records to assist with a mortgage application.”

He also recommends that self-employed people should speak to a trusted mortgage adviser to help them understand the process and what information they will need to have on hand.