With many more people working on a contractor basis these days there is a high demand for mortgage lenders to be more flexible in how they can assist people who choose to work on this basis when it comes to obtaining a mortgage. The good news is that whilst you may be paid in a more complex way all is not lost as there are a number of mortgage options out there.
Whether you are CIS, IR 35 or an umbrella company providing you have a track record to working on this basis for at least 12 months then there are choices available. You will need to provide 6-12 months invoices or vouchers, or if using an umbrella company, the last 12 months accounts along with a copy of the contract and confirmation of the date the contract is due to end then there are lenders who can assist. We would ask for evidence that the contract has at least 3 months left to run or that you have confirmation of a start date for a new contract and then we can package a case to the lender.
The amount you can borrow is dependent on the individual lenders affordability calculators and is worked out by using the day rate multiplied by an average of the number of weeks worked so if you have a good day rate then the borrowing capacity can be very generous.
In a recent example of a contractor I have helped obtain a mortgage, he was contracting to a company based in the far east and whilst they paid him on a regular basis the records they sent to him were sporadic to say the least. They were only on a basic spreadsheet with no reference to the company or the client and frankly no use! I managed to find a contact in a Uk based office to explain what we needed and why we needed the information and after several attempts we were able to provide the lender with sufficient information for them to be able to offer a first time buyer the mortgage he needed to secure his first home.
I’m featured as in The Times as one of the Uk’s Top-rated advisers and have helped numerous clients over the years and have great relationships with the mortgage lenders and have a full understanding of this arena so if you find you are in this position and this resonates with you please get in touch.