# HL-Q151: Choosing a loan What's the best bank for a home loan if you're self-employed and have been in business for three years? Borrower: Business-owning couple buying a household home [Study](https://nzbrands.ai/research/banking/home-lending/) · Collected 11 October 2026 ## chatgpt Answer ID: c8674625-f5d5-445b-aa19-9d2be94ed12b ## Best home loan banks in New Zealand if you're self-employed for 3 years If you've been self-employed for three years in New Zealand, **I'd start by comparing BNZ, ASB, ANZ and Westpac, rather than assuming one bank will be best.** Your three-year business history can be an advantage because you may have enough financial records to demonstrate consistent income. The key is finding a lender that assesses self-employed income fairly, offers a suitable interest rate, and is comfortable with how you earn your money. ### Which banks should you approach first? | Bank | Why it's worth considering | What you'll generally need | |---|---|---| | **BNZ** | A good starting point if you have a solid financial track record. | Your last two annual business financial statements. [BNZ home loan requirements](https://www.bnz.co.nz/support/home-loans/buying-a-home/preparing-for-a-home-loan-appointment). | | **ASB** | Worth comparing if you have consistent income and well-prepared accounts. | Your latest accountant-prepared financial statements and evidence of your deposit. [ASB application guide](https://www.asb.co.nz/home-loans-mortgages/home-loan-application-checklist-guide.html). | | **ANZ** | Worth considering if your business income is straightforward to document. | Financial statements, preferably prepared through your accountant. [ANZ application guide](https://www.anz.co.nz/personal/home-loans-mortgages/how-to-apply/). | | **Westpac** | Another strong option for comparing lending terms and interest rates. | Your latest accountant-prepared financial statements. [Westpac application guide](https://www.westpac.co.nz/home-loans-mortgages/how-to-apply-for-a-home-loan/). | These banks all assess self-employed applicants, but their individual lending criteria and assessment of your income may differ. The documentation requirements above are based on their published guidance. Sources: [BNZ](https://www.bnz.co.nz/support/home-loans/buying-a-home/preparing-for-a-home-loan-appointment), [ASB](https://www.asb.co.nz/home-loans-mortgages/home-loan-application-checklist-guide.html), [ANZ](https://www.anz.co.nz/personal/home-loans-mortgages/how-to-apply/) and [Westpac](https://www.westpac.co.nz/home-loans-mortgages/how-to-apply-for-a-home-loan/). ## What matters most when you're self-employed? Having been in business for three years is a good starting point, but lenders will generally look at several other factors. - **Your net profit:** How much income your business generates after expenses, rather than just its turnover. - **Consistency of earnings:** Whether your profits have increased, stayed steady or declined over the last two financial years. - **Your business structure:** Whether you're a sole trader, a contractor, or a director of a limited company. - **Your deposit:** A 20% deposit can make the application more straightforward, although other options may be available. - **Your existing debts:** Personal loans, credit cards, vehicle finance and business liabilities can affect your borrowing capacity. For example, if your company earns $250,000 in annual revenue but generates only $70,000 in net profit, the bank won't necessarily treat you as earning $250,000. Similarly, if you own a company and pay yourself a relatively small salary while retaining profits in the business, the way the lender assesses that income can make a significant difference. ## My recommendation: Talk to a mortgage adviser For someone who has been self-employed for three years, I'd seriously consider speaking to an independent mortgage adviser before applying directly to several banks. An adviser can compare lenders, help establish which banks are likely to accept your income structure, and present your financial situation appropriately. This can be especially valuable if: - Your income fluctuates from year to year. - You retain profits in your company. - You have a relatively small deposit. - Your latest financial year was significantly better than the previous one. The aim is to identify the lender most likely to offer you a suitable loan, not simply the bank advertising the lowest interest rate. ## Let me narrow it down to the best bank for you I can give you a more specific recommendation if you tell me three things. **1. How do you operate your business?** - A. Sole trader - B. Limited company (you pay yourself a salary) - C. Limited company (you mainly take drawings or dividends) - D. Contractor or self-employed professional **2. Roughly how much do you earn per year before personal tax?** Your personal income or average annual profit is fine; an approximate figure is all I need. **3. How much deposit do you have?** - A. Less than 10% - B. 10–19% - C. 20–29% - D. 30% or more With those answers, I can help you work out **which New Zealand banks I'd approach first and which aspects of your application are likely to matter most.** --- ## gemini Answer ID: 4da2a497-09cb-4672-9334-9cee01fd7d78 In New Zealand, there isn't a single "best" bank for self-employed borrowers because **all the major mainstream trading banks (ANZ, ASB, BNZ, Westpac, and Kiwibank) apply very similar baseline criteria** when assessing a business with **three years of trading history**. Because you have reached the 3-year mark, you are past the most restrictive hurdle—most major lenders prefer to see at least 2 full years of financial accounts and IRD tax returns. The "best" bank for you depends entirely on how your business accounts are structured, your industry, and your deposit size. --- ### Key Factors That Determine Which Bank is Best for You 1. **Your Deposit Size (The 20% Threshold)** * **20% or more deposit:** If you have at least a 20% equity or deposit, you unlock the mainstream market. Every major bank will compete for your business, offering aggressive interest rates and cash-back contributions (often ranging around 0.85% to 1.00% of the loan amount for qualifying sums). * **Less than 20% deposit:** Your options narrow, and you will be subject to Reserve Bank LVR (Loan-to-Value Ratio) speed limits, low-equity margins, or low-equity fees. 2. **How Your Accountant Structures Your Profit** * Traditional banks evaluate your servicing capacity based on your **net taxable income** (what shows on your IR3 or company returns after all business write-offs and depreciation). * If you minimize your taxable profit for tax purposes, your borrowing capacity will look artificially low on paper. Some major banks are more flexible than others at recognizing legitimate "add-backs" (such as one-off expenses, depreciation, or retained earnings in a company structure). --- ### How Major New Zealand Banks Assess 3 Years in Business * **ANZ & ASB:** Generally known for having robust mobile app integrations (like Xero feeds) and structured self-employed assessment calculators, making the application smooth if your financials are clean and tidy. * **BNZ & Westpac:** Often praised by mortgage advisers for having pragmatic internal credit risk teams that can look at the overall trajectory of a 3-year-old business, especially if you can demonstrate steady or growing cash flow through 6 months of business bank statements. * **Kiwibank:** Often competitive on standard interest rates and flexible with local decision-making, though they still strictly require full accountant-prepared financials. --- ### Actionable Strategy for a 3-Year Self-Employed Borrower Rather than shopping around bank-by-bank (which leaves multiple credit inquiries on your file), take these steps to secure the best deal: 1. **Prepare a "Mortgage-Ready" Pack:** Ensure your last two to three years of accountant-prepared financial statements (Profit & Loss, Balance Sheet), corresponding IR3/IR7 tax returns, and GST returns are completely up to date. If your latest financial year has just wrapped up, have your accountant pull draft accounts or a Xero Business Finance Pack immediately. 2. **Engage a Mortgage Adviser:** For self-employed applicants, using a mortgage broker is usually free (they are paid commission by the lender) and highly advantageous. A good broker knows which specific bank’s credit policy is most lenient toward your specific industry or income structure (e.g., contractor vs. company director vs. sole trader). 3. **Leverage Your History:** Because you have three solid years behind you, highlight your revenue trends, client retention, and steady business bank account inflows. If your income has grown year-on-year, ask your adviser to pitch your application based on an average or an annualized run-rate of your latest earnings rather than just a flat backward-looking average. Would you like to explore how lenders calculate self-employed income based on different business structures (like a sole trader versus a limited company)? --- ## ai-mode Answer ID: 35759381-7763-475e-9818-634b09cdc330 Having been in business for **three years** puts you in a strong position with mainstream New Zealand retail banks. Most major lenders require a minimum of **two years** of profitable financial statements and IR3 tax returns, meaning three years comfortably satisfies their baseline trading history requirement. Because you meet the standard two-year threshold, there is no single "best" bank for everyone. Instead, the right choice depends on how your accountant structures your net profit, add-backs (like depreciation or personal vehicle expenses), and your industry. The major New Zealand retail banks and how they generally compare for self-employed applicants include: * * **ANZ:** Often favored for its flexible approach to assessing complex business structures (like trading trusts or multiple companies) and a transparent calculation of operating cash flow. * **ASB:** Known for a streamlined digital application process and robust mobile banking, with a predictable credit policy for standard sole traders and limited companies with stable three-year track records. * **BNZ:** Highly competitive on turnaround times for business and home lending integration, making it a strong contender if you already hold your business accounts with them. * **Kiwibank:** A state-owned option that can be flexible and community-focused, though they adhere strictly to standard debt-to-income (DTI) and serviceability metrics. * **Westpac:** Well-regarded for personalized mobile mortgage manager support, which can be useful when presenting add-backs and year-three growth trajectories to their credit team. * What Banks Look For at 3 Years * * **Financial Stability:** Two to three years of Profit & Loss statements, balance sheets, and IR3/company tax returns via MoneyHub NZ. * **Add-Back Adjustments:** Lenders will look at your net profit and add back non-cash or one-off expenses (such as depreciation, personal use of a vehicle, or one-off capital purchases) to determine your true working income. * **Business vs. Personal Debt:** Any debt held within your business structure will be factored into your total borrowing capacity. * If your financial statements show consistent or growing revenue over those three years and you have at least a 20% deposit, any of the major main banks will view you favorably. [MoneyHub NZ] To help narrow down which specific lender or broker path fits best, could you tell me: * What is your **estimated deposit size** (under or over 20%)? * Is your business structured as a **sole trader, partnership, or limited company**? --- ## ai-overviews Answer ID: 85be4d10-e2a1-49e9-8c57-d7130b8078f7 For a self-employed borrower who has been in business for **three years** , there is no single "best" bank because the decision depends heavily on how your net profit trends and how your accountant structures your taxes. However, since you have hit the **three-year milestone** , you have already cleared the hardest hurdle for traditional lending: mainstream New Zealand retail banks strictly require a **minimum of two full years** of filed financial statements and IR3 tax returns. This means you fully qualify to apply with the major banks and access the lowest standard interest rates in the market (typically **5.5% to 6.5%**) rather than needing to rely on expensive non-bank lenders. * * * How the Major NZ Banks Compare for Self-Employed Because your business has three years of history, banks will look at your net profit trends. How they calculate your "assessable income" varies significantly between institutions: Bank| Income Assessment Method| Best Suited For ---|---|--- **ANZ**| Often assesses the **most recent year in isolation** if the business is growing.| Businesses whose revenue and profit **increased significantly** in year three compared to years one and two. **BNZ / Westpac**| Typically averages the last two years or takes the **lower of the two years** to mitigate risk.| Businesses with stable, predictable year-on-year earnings. **ASB / Kiwibank**| Requires full financial accounts and focuses heavily on **sustainable shareholder drawings**.| Owners who pay themselves a consistent salary or regular drawings from the business. * * * Crucial Factors That Dictate Your Approval * **The "Add-Back" Strategy:** Mainstream banks do not just look at the bottom-line taxable income your accountant filed. Most lenders will "add back" non-cash or one-off business expenses—such as **depreciation, home office deductions, and shareholder interest** —to artificially increase your borrowing power. * **The 20% Deposit Threshold:** While salaried workers can sometimes secure home loans with a 5% to 10% deposit, main retail banks strongly prefer a **20% deposit** for self-employed applicants to avoid strict Loan-to-Value Ratio (LVR) penalties and secure the best pricing. * **Declining Profit Pitfalls:** If your third year shows a drop in profit compared to your second year, mainstream banks will immediately default to using the lowest year’s figure or may decline the application. * * * What to Do If Main Banks Say No If your three-year financials show fluctuating income, or if your accountant aggressively minimized your net profit for tax purposes, traditional banks may limit your borrowing capacity. If that occurs, your best route is a **Near-Prime or Alt-Doc (Alternative Documentation) loan** through reputable non-bank lenders like Pepper Money or Avanti Finance. These lenders accept 6 months of GST returns or business bank statements instead of formal tax returns, though interest rates are higher (typically **7% to 9%**). Home Loans for SelfSelfMortgage for Self Employed NZ: The 2026 Guide to Getting Approved[Top 5 Non-Bank Lenders in New Zealand \[2026\] | Opes Partners](https://www.opespartners.co.nz/mortgage/non-bank-lenders-top-5)SelfBank vs Non To give you the most accurate advice, could you tell me: * Has your business net profit **increased, stayed stable, or decreased** over the last 3 years? * Do you pay yourself a **fixed shareholder salary/drawings** , or does your income fluctuate? * Roughly what **percentage of a deposit** do you have ready?