Self Employed Remortgage: How to Remortgage When Self Employed or on Part Time Hours

If you’ve recently become self-employed or your hours have reduced, you might be nervous about remortgaging. 

It’s important to assess your financial commitments regularly, and you shouldn’t let being self-employed or having part-time hours impact that process. 

Remortgaging when self employed is absolutely possible and quite straight forward.  

The main difference with remortgaging now you’re self employed, compared to when you were employed, is that you’ll need to give additional information to prove your income and demonstrate that you can afford the monthly payments. Other than that, you’ll have access to the same remortgage deals as employed individuals. 

Lending money is always concerned with risk, and being employed doesn’t necessarily make a person more or less of a risk. Risk is assessed based on many factors, and income is just one of those factors. For example, a self employed person who can afford the payments and has a spotless credit history is less risky than an employed person with a low credit score. Unfortunately, you’ll need to provide more evidence of income than an employed person.

If you have less than one year of accounts, you might struggle to prove your average income level, but a remortgage adviser might be able to find a company who’ll consider your application.

No, it’s not harder to get a remortgage when self employed compared to employed, but you will be required to provide a little more information to prove your income. Evidence of your income is one of the ways that a remortgage lender assesses whether you can afford the monthly repayments.

It can be easier to stay with the same lender, regardless of whether you're self employed or employed, but it might not be beneficial over time. You wouldn’t remortgage with the same lender; you’d likely get a product transfer – or a further advance if you wanted to borrow more money. 

Choosing whether to stay with an existing lender can be a difficult decision, especially when faced with competitive remortgage deals from other lenders. 

Like all choices, there are pros and cons, and your personal circumstances need to be considered. Your existing lender will already have a relationship with you, so they may be able to see that you’ve never missed a payment. They’re also more likely to accept fewer years of accounts than a different lender, who’s assessing you as a risk for the first time. 

However, staying with your existing lender may be less competitive as an existing customer, which could make switching to a new remortgage deal an attractive option. On the other hand, your existing lender might incentivise your loyalty by reducing or eliminating some of the fees for transferring you to a new product. 

A remortgage adviser can walk you through all of the pros and cons, helping you understand your options and ensuring you make an informed decision.

No, self employed remortgages aren’t necessarily more expensive than any other type of mortgage. A remortgage is based on risk, and risk is determined by a number of different factors - such as your credit score, how much of your house you own and how much you earn each month. 

If you need further information on self employed remortgages, or to speak to one of our expert remortgage advisers, give us a call on 0330 433 2927 or enquire online.