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With so much information about contractor mortgages on the internet, it's hard to know where to start. If you give me 3 minutes i'll explain EVERYTHING you need to know.
Let's get going.
What is a contractor mortgage?
A contractor mortgage is a 'prime rate' mortgage product with bespoke underwriting. What this means is that a mortgage lender will assess a contractor or freelancer's mortgage application on a case by case basis, using a combination of factors. These include:
* Contract rate
* Duration of existing contract
* Retained profits
* Number of years contracting
Contractor mortgages do NOT fall under self certification, where interest rates are often much higher and mortgage lending is based on generic 'one size fits all' underwriting.
Can anyone apply for a contractor mortgage?
There is no set criteria for the average contractor mortgage and many people are often surprised by the number of mortgage products available, even for first time buyers or those with an adverse credit rating. There is also somewhat of an urban myth among many IT contractors that you need 3 years worth of accounts before you should even consider applying for a mortgage. This simply isn't true.
Aren't contractor mortgages expensive?
It depends which IFA or mortgage broker you speak to. 99% of financial advisors will suggest that you self certify - and yes, this will often result in a comparatively expensive mortgage.
If however you work with a contractor or freelancer specialist advisor, you will often receive EXACTLY THE SAME mortgage terms as any full time employee.
Where can I find out more information?
A simple Google search for 'Contractor Mortgages' will throw up a myriad of companies claiming to be contractor-focused IFAs. To save you time, we have asked our friends at Freelancer Financials if they would be kind enough to provide FREE telephone advice to our loyal readers (see below).
Contractor mortgages - getting one doesn't have to be
What every contractor should know about buy to let mortgages
Mortgages for contractors at five year low
Contractors - don't miss the stamp duty deadline!
Attempt to end self-certification mortgages
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