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Mortgages for Contractors

As a contractor, getting a mortgage is notoriously difficult, but it doesn’t have to be. With the right help you can get access to contractor mortgages from leading lenders; that’s where ams: come in.

Don’t worry – call us now and speak to one of our team who can talk you through your options

Contractor Mortgage FAQ

What is a Contractor Mortgage?

A contractor mortgage is only different from a mainstream mortgage in terms of how a lender will assess your eligibility for a loan. The underwriter will bypass traditional means of assessment and will adhere to a specialist criteria in order to assess your needs on an individual basis.

What are the problems with securing such a mortgage?

Lenders have tightened their criteria over the past few years following the credit crunch. As a result contractors have faced a struggle trying to source a loan or mortgage. Contractor mortgages have previously fallen outside the bank and building societies strict lending criteria as many lenders see it as a grey area. Previously lenders have been concerned by contractors not being able to supply consistent payslips, or where accounts don’t reflect true income.

What's the solution?

With ams: you can overcome these issues and find the right mortgage available for you. There are lenders with whom these requirements are not always essential, some lenders will work on the value of the contract rather than your net profit, or salary and dividends when calculating eligibility. Lenders have now realised that contractors can be safe borrowers with a stable income. So in essence…getting a mortgage is possible if you are a contractor.

Am I restricted to my SA302 or Limited Accounts?

Not at all.  Where technically you are self-employed and most lenders will want you to provide these for proof of income, there are lenders which may use gross earnings based on their calculation of your current day rate.

For example

Day rate x 5 x 48 = £ Income

This will definitely increase your affordability to those lenders who will use your income from self-employment for maximum loan calculations. Though if you are not an IT contractor there could be some minimum income criteria so it is essential you get the right advice

I have had some career breaks between contracts, will I be able to get a mortgage?

Potentially yes. Some lenders allow some time off between contracts, continuous history is preferable but not always essential. It all depends on the lender’s criteria for your particular contract type and your circumstances and getting it right first time.

I also have some bad credit, can you help me?

Some lenders will consider issues with your credit file, though there are restrictions and these may vary depending on your contract. To avoid the disappointment of a declined mortgage you should speak to an ams: specialist.

I have been told there is minimum income criteria, is that right?

Some, but not all, lenders do have minimum income criteria for all types of contractors but not all. We ensure we only look at placing you with the right lender for your circumstances.

I have recent changed my accountant and the way I submit my accounts, will this change anything?

This is common for contractors and we deal with it daily. It is best to get the right advice before you apply as lenders take a different view on this case by case.

My contract is rolling, with no end date. I imagine this will cause problems?

Most lenders will prefer an end date and an amount of time remaining on the contract however it does depend on your circumstances, what type of contracting work you do and career to date. However there may be options when a contract is rolling.

I also have BTL properties, can you help?

Absolutely, criteria change massively for all contractors when discussing your options on a BTL basis.

I use the agencies umbrella payroll company, will this be an issue?

Not necessarily though the criteria around this differs lender by lender depending on the contract and what you do. It is important if you are making use of the agencies umbrella company to apply to the right lender.

As I am not permanently employed I am concerned about mortgage payments and what I can afford.

ams: will have this discussion with you from the very start of your mortgage journey and would never make a recommendation that is not affordable based on the contract work you do. As all of our advisors are protection specialists we will also discuss these needs going forward.

I have a lot of colleagues discuss their issues with getting a mortgage with me on a regular basis, can you help them?

Absolutely. And you may even qualify for out referral incentive.

Want to get started?

Choosing the right mortgage for you can be really tricky. At ams: our expert advisers guide you through the process. Simply, efficiently and professionally.

Call now to speak with a mortgage advisor

0121 4000 052

As a guide, you could potentially borrow around:

The figure above is calculated based around current lender criteria and may not be representative of the actual figure you may be able to borrow.

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