Why 75% LTV Is a Favourable Starting Point for Self-Employed Remortgages
At 75% LTV, self-employed borrowers have access to a much broader range of lenders than at higher LTV bands. Most mainstream lenders — including high street banks and building societies — will consider self-employed applications at 75% LTV, provided the income can be satisfactorily evidenced. The 25% equity acts as a meaningful risk buffer that encourages lenders to look carefully at the application rather than defaulting to simpler exclusion criteria.
The rates available at 75% LTV are also among the most competitive in the mortgage market, regardless of employment status. The best rates are typically reserved for clean-credit borrowers with LTV ratios of 60% or below, but 75% LTV sits in a tier that still attracts strong pricing. Self-employed borrowers at this LTV are unlikely to face a significant rate premium specifically because of their employment status — the primary variable in rate pricing is the LTV, not whether you are employed or self-employed.
Lender attitudes toward self-employment have evolved significantly over the past decade. The rise in self-employment in the UK has encouraged mainstream lenders to develop clearer, more consistent self-employed assessment criteria. While the requirements for documentation are more extensive than for employed borrowers, the underlying willingness to lend at 75% LTV to self-employed individuals with verifiable income is well established.
Where complications can arise at 75% LTV for self-employed borrowers is when income is very variable, very recently established, or structured in ways that are difficult to evidence through standard documentation. These are situations where specialist lenders or brokers with self-employed expertise add real value — not because mainstream lenders will never consider them, but because getting the application presented correctly is critical.
How Lenders Assess Self-Employed Income at 75% LTV
The standard approach for most lenders is to assess self-employed income using two to three years of tax calculations (SA302 forms) and corresponding tax year overviews from HMRC. For sole traders and partnerships, this means looking at the profit figures from the self-assessment returns. For limited company directors, lenders typically look at salary plus dividends, though some lenders also consider a share of the company's net profit, which can be more advantageous for directors who retain profits within the business.
Where two or more years of accounts are available, many lenders will use either an average of the two most recent years or the most recent year alone, whichever produces the more favourable income figure — though some lenders take the more cautious approach of using the lower of the two years. A broker who knows which lenders apply which assessment method can direct your application to those most likely to produce the highest affordable borrowing amount.
For borrowers with only one year of self-employed accounts, the lender options at 75% LTV are more restricted but not negligible. A growing number of specialist and near-prime lenders accept applications from borrowers with one year of accounts, particularly where there is a prior employed history in the same field. This is one area where a broker's specific knowledge of individual lender criteria is very valuable.
Income that is highly variable from year to year can be challenging for self-employed remortgage applications, even at 75% LTV. If your most recent year's income is significantly lower than the previous year — due to a quiet period, a change in business structure, or deliberate profit management — lenders will typically use the lower figure in their affordability calculation. This can reduce the available borrowing amount even where the underlying business is healthy.
