Remortgaging When Self-Employed: A Complete Guide 2025

Remortgaging When Self Employed: A Complete Guide 2025

Remortgaging when self-employed can feel more complicated than it should be. An important difference between remortgaging as a self-employed person and as an employed person is the extra documentation and preparation required to prove your income and financial stability. Whether you’re a freelancer, contractor, or small business owner, proving your income and securing a competitive deal often requires more preparation. However, with the right approach and expert mortgage advice, remortgaging as a self-employed borrower can be straightforward and highly rewarding.

What Does Remortgaging Mean?

Remortgaging simply means switching from your current mortgage to a new one, either with your existing lender or a different provider. This process involves applying for a new mortgage product, which may have different requirements for self-employed individuals. The standard remortgage process for self-employed individuals is largely the same as for employed individuals, with some additional paperwork required.

Most people remortgage to access a better interest rate, release equity from their property, or adjust their mortgage term.

For self-employed individuals, remortgaging can also be a valuable way to align your mortgage with your current business or income situation.

Why Self-Employed Borrowers Face More Scrutiny

Lenders view self-employed income differently because it can fluctuate from year to year. While salaried applicants can provide simple payslips, self-employed applicants often need to show two to three years of tax returns, SA302s, and HMRC tax year overviews. There are some high street lenders who will accept 1 years accounts, SA302’s ad tax year overviews.

This doesn’t mean it’s harder to remortgage, it just means lenders need more evidence to understand your affordability. Self-employed borrowers must demonstrate stability and provide evidence of consistent earnings to reassure lenders of their financial reliability. A specialist mortgage broker experienced in self-employed remortgages can help you present your income in the strongest possible way.

When Is the Best Time to Remortgage?

The ideal time to start looking at remortgage options is usually three to six months before your current deal ends. If you wait until your fixed rate expires, you could be moved to your lender’s Standard Variable Rate (SVR), which is often higher and more expensive (the lender’s standard variable rate is the default interest rate you are transferred to once your existing mortgage deal ends). You can remortgage any time during your mortgage term, but the most strategic option is to do it six months before your current deal expires to avoid higher rates.

If you’re self-employed, it’s wise to start early. Gathering financial documents, preparing accounts, and exploring specialist lenders can take longer than for employed borrowers. Planning ahead ensures a smooth transition to your new deal without any surprise rate increases.

Remortgaging before your current deal ends may require you to pay an early repayment charge, so always check your mortgage terms to avoid unexpected costs if you pay an early repayment.

Common Reasons to Remortgage When Self-Employed

1. Securing a Better Rate – Interest rates fluctuate, and if you originally took your mortgage when rates were higher, you could save a significant amount by switching to a better deal.
2. Releasing Equity – If your property has increased in value, you can release some of that equity to fund business expansion, home improvements, or consolidate debts. Self-employed borrowers should be prepared to identify and document their main income source when applying for a remortgage, as lenders will require clear evidence of your primary earnings.
3. Changing Your Mortgage Term – You may want to shorten your mortgage term to pay it off sooner, or extend it to reduce monthly payments.
4. Switching from Interest-Only to Repayment – Some self-employed borrowers start with interest-only mortgages to keep payments lower. Remortgaging gives you the opportunity to move to a repayment mortgage and build more equity.
5. Lowering Your Loan-to-Value (LTV) Ratio – Lowering your LTV ratio makes you appear less risky to lenders, which can help you secure better rates.

How to Prepare for a Self-Employed Remortgage

1. Organise Your Accounts

Make sure your accounts are up to date and ideally signed off by a qualified accountant. Keeping records of ongoing clients can help demonstrate future revenue stability to lenders. Lenders like consistency, so ensure your income records accurately reflect your business performance.

2. Review Your Credit Score

A strong credit profile can open up more mortgage options and better rates. Having no missing payments on your credit record is crucial for improving your chances of remortgage approval. Check your credit report for errors and ensure all bills, loans, and credit cards are paid on time. Additionally, being on the electoral register helps lenders verify identity and address for mortgage applications.

3. Gather the Right Documents

Most lenders will ask for:

• Two to three years of SA302s and tax year overviews
• Business accounts signed by an accountant
• Recent bank statements (personal and business)
• Identification and proof of address

These documents are essential for mortgage applications, as they help lenders assess your financial stability and income consistency.

Having these ready will speed up the remortgage process. Being prepared with all required documents will also help streamline the underwriting process, making it easier and faster for lenders to assess your application and approve your loan.

Documents Required for Limited Company Directors

If you run your business as a limited company director, lenders assess both your salary and dividends, and may also look at retained profits in the company depending on the lender’s criteria. Lenders will consider you self-employed if you own more than 20% of the company where you earn your main income. You’ll typically need to provide:

• Two to three years of full company accounts (signed by a qualified accountant)
• SA302 forms and HMRC tax year overviews for the same period
• Latest three to six months of business bank statements
• Latest three months of personal bank statements
• Proof of shareholding or Companies House registration (to confirm your position as a director)
• Current identification and proof of address

Some lenders may also request management accounts if your last set of year-end accounts are more than six months old.

If you pay yourself a low salary but retain profits in the company, a specialist mortgage broker can direct you to lenders who take retained earnings into account when calculating affordability.

Providing comprehensive documentation can help limited company directors secure favourable remortgage terms from lenders.

Documents Required for Sole Traders

If you operate as a sole trader or freelancer, your income is usually assessed based on your net profit as declared to HMRC. As a self-employed person, you will need to provide evidence of your income and business activity to satisfy lender requirements.

The following documents are typically required:

Lenders often consider any future contracts or work lined up as part of the income assessment, which can be particularly helpful for freelancers or contractors.

• Two to three years of SA302s showing total taxable income
• HMRC tax year overviews for the same periods
• Latest three to six months of personal and business bank statements
• Proof of identity and current address
• Evidence of ongoing contracts or work, if applicable (especially useful for contractors or freelancers with variable income)

If you’ve recently become self-employed and only have one year of accounts, there are lenders who will still consider your application, particularly if you have a strong credit profile and a steady flow of work. Most lenders, however, require self-employed applicants to submit SA302 tax calculations and tax year overviews for the last two or three years.

How Lenders Assess Self-Employed Income

Lenders typically look at your average income over the past two to three years, though some may use your most recent year if your earnings are increasing.

When a self-employed remortgage is assessed, the process is different from a standard mortgage compared to employed applicants, especially regarding income assessment and required documentation.

For limited company directors, lenders may consider salary plus dividends, or salary plus retained profits. For sole traders, the focus is on your declared net profit.

A skilled mortgage broker can present your income in the most favourable way, highlighting the full picture of your financial stability.

Lenders That Accept Self-Employed Applicants

Here’s an overview of well-known lenders that are open to self-employed borrowers and their typical requirements. Many lenders have different criteria for self-employed applicants, so it’s important to compare mortgage lenders to find the best fit. Please note: criteria change regularly, so always confirm the latest terms.

This table is for general guidance only. Lending criteria, loan-to-value limits, and documentation requirements may vary by lender. Requirements can differ significantly from one lender to another, and some other lenders may have more flexible documentation requirements than those listed here.

Benefits of Using a Mortgage Broker for Self-Employed Remortgaging

• Access to Specialist Lenders not available directly to the public
• Expert Guidance on presenting your income and documentation
• Time Savings your broker handles the process from start to finish
• Tailored Recommendations suited to your goals, whether you’re releasing equity, reducing your rate, or adjusting your term

An experienced mortgage adviser can also help you navigate lender affordability assessments, ensuring your application meets the right criteria before submission. Mortgage advisors can provide valuable insights and support throughout the remortgaging process, especially for self-employed borrowers.

Future Work and Financial Planning

When planning a self-employed remortgage, it’s important to look beyond your current financial position and consider your future work and income prospects. As a self-employed individual, your income may fluctuate, so lenders will want to see that you have a predictable cash flow and a clear growth strategy for your business.

Demonstrating stability is key as most lenders will look for evidence of retained clients, ongoing contracts, and a steady stream of work to reassure them that your income is sustainable. Lenders typically require several years of accounts or tax returns to assess your affordability for remortgaging as a self-employed person.

To put yourself in the strongest position, make sure your financial documents are up to date. This includes recent tax returns, tax year overviews, and both personal and business bank statements. For newly self-employed people, it can be more challenging to secure a remortgage.

Having a good credit score and a healthy credit history can help offset a shorter trading record. Lenders will also want to see proof of income and may ask for signed contracts or evidence of future work, especially if you’re a sole trader or run a limited company.

Working with a mortgage broker who specialises in self-employed remortgage deals can make a significant difference. They can help you present your financial situation in the best possible light, identify the right deal for your circumstances, and guide you through the remortgage process from start to finish.

A broker will also help you compare remortgaging costs, such as early repayment charges, arrangement fees, and valuation fees, ensuring you understand the true cost of switching to a new lender.

It’s also wise to be aware of your current lender’s standard variable rate, as moving onto this after your current deal ends could increase your monthly repayments. By planning ahead and having a solid financial plan in place, you can save money, secure a better interest rate, or even release equity for future business growth or home improvements.

Ultimately, the key to a successful self-employed remortgage is preparation. By maintaining a stable income, keeping your credit record healthy, and having a clear understanding of your future earnings, you’ll be well-placed to secure the best deals available. With the right advice and a proactive approach, self-employed people can navigate the remortgaging process with confidence and achieve their long-term financial goals.

Final Thoughts

Remortgaging when you’re self-employed doesn’t have to be difficult. With careful planning, accurate financial records, and the right mortgage broker by your side, you can secure a deal that truly reflects your financial position and potentially save thousands over the life of your mortgage. Remember, it is possible to remortgage if I’m self-employed or remortgage if you’re self-employed, as long as you have the right documentation in place.

If your current mortgage deal is coming to an end, or you’re exploring better options, now is the perfect time to review your self-employed remortgage opportunities. While the process may differ from other remortgage situations, with expert advice, self-employed borrowers can still secure a great deal that genuinely works for you.

Get help from an experienced mortgage broker.

You can speak to one of our specialist mortgage brokers who would be able to guide you through the process. They will advise if there is a lender available and the maximum loan amount based on your circumstances. We are a whole of market mortgage brokerage with access to all lenders. Call us on 01332 470400 or complete the form with your details for us to give you a call back.

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