[codingdave]

Banks are looking for stability in your income. A regular salaried job counts as stability. But proven bank deposits over multiple years also counts. I wouldn't shy away from self-employment just because of banks.

Source: I worked at a bank, and wrote algorithms for loan acceptance which evaluated such things.

[biztos]

For loans, banks are looking for expected future stability in your income.

I would never discourage anyone from self-employment, but right now I'm watching a good friend try to get a mortgage in Germany... and he's been running his own company for 20 years... in a highly volatile industry... and let's say they'd be treating him a whole lot better if he had a boring day job at some big company.

If you're planning on stuff like mortgages and (depending on your passport) visas, "regular old job" is worth many multiples of self-employment. If your self-employment makes enough that you won't need a mortgage (etc.) then great, but I would bear it in mind when thinking about quitting the day job.

[mtbcoder]

> I would never discourage anyone from self-employment

I would, especially if they are in their prime earning years and are trying to become independent contractors. Software engineering jobs command high salaries and benefits these days. The opportunity costs are just too high and the odds of sustaining a one-person contracting show for 5, 10, 20+ years is slim to none.

[robjan]

It's easy to change from independent contractor to employee if you really want. The experience on the CV is just as good and you probably get paid (a lot) more.

The only real risk is that during economic downturns it may be hard to find contracts but your employer could fire you as well.

[nyokodo]

It depends on the market. I worked with contractors back in 2008 who said it became easier to find work during the crash because they were seen as Capital Expenditure while Full-Time Employees were considered Operating Expenditure and were being laid off en-masse.

[robjan]

This benefit is always true, especially in locations where you can write off CapEx against your taxes. My main point was that if you are a contractor and want a perm role you can just apply for a permanent job. You don't even need to write whether or not you were a contractor in your application form / CV, the hiring manager only cares about your projects and roles within the project.

[mtbcoder]

> But proven bank deposits over multiple years also counts.

That's just one factor. Banks are looking to minimize risk and from the perspective of banks, self-employment increases risk. That's not to say banks won't loan to you, just that the hurdle is much higher for you to prove that you are not a risk. Chances are your interest rates will still suffer even when a bank decides to loan to you.