Less than 12 months contracting history - mortgage
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    Default Less than 12 months contracting history - mortgage

    I've been lurking around for over a year, decided to create an account now that I have a question.

    I have applied for a mortgage via broker with less than 12 months contracting history, and she seems to only have access to one mortgage product with pretty high rate.

    Is this right? Don't I have any choice between products just because I am contracting for less than a year?

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    Which broker are you using?

    There a quite a few who post here - have you tried one of them?

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    Quote Originally Posted by tractor123 View Post
    I've been lurking around for over a year, decided to create an account now that I have a question.

    I have applied for a mortgage via broker with less than 12 months contracting history, and she seems to only have access to one mortgage product with pretty high rate.

    Is this right? Don't I have any choice between products just because I am contracting for less than a year?
    I used Contractor Financials but I had been contracting for a couple of years. I've recommended them to people who tell me they were able to get a decent rate offer with less than one year contracting.

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    Depends on your daily rate and contract length. Freelancer Financials have been really helpful.
    Last edited by Contractor UK; 28th June 2016 at 17:08. Reason: Personal Details Removed

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    Barclays/Woolwich have never been a problem in the past for contractor mortgages.
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    Quote Originally Posted by kaiser78 View Post
    Barclays/Woolwich have never been a problem in the past for contractor mortgages.
    Do you know if they accept less than 12 months accounts? Should I go directly to them or via broker?

    I used one of the brokers from this website and she says my only option is Halifax as I have been contracting for less than a year.

    I'd like to have a choice and ability to compare at least two mortgages before signing up with anyone
    Last edited by tractor123; 28th June 2016 at 08:29.

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    It's not just about your accounts, but the LTV - i.e. the size of the mortgage compared to the value of the property.
    If you put down a bigger deposit, you'll get more options on who will lend to you and you'll probably get better rates.
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    Quote Originally Posted by tractor123 View Post
    I've been lurking around for over a year, decided to create an account now that I have a question.

    I have applied for a mortgage via broker with less than 12 months contracting history, and she seems to only have access to one mortgage product with pretty high rate.

    Is this right? Don't I have any choice between products just because I am contracting for less than a year?
    I was in the same situation last year and went through Freelancer financials, they advised the only lender who would accept based on my current contract would be Halifax. The gave me an agreement in principle, but only with a 15% deposit which scuppered my plans, so I didn't proceed.

    Having worked for a long time at a high street bank, I'm not at all surprised by this. Most lenders will asses you as self employed or company director, so with less than 2 years full accounts (most likely you haven't even filed your first year's yet), it will be very difficult.

    You'll have a lot more options when you've been going for longer than 2 years. A few lenders will be able to lend you based on your current daily rate, which means you'll be able to borrow more, but it's a big risk for the bank, so most will only do that with a good couple of years contracting history. Once you've been trading for 2 or 3 years, that will open up the market for you to traditional mortgage who can asses you based on your company accounts, but they won't lend you as much as the contractor specialists.

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    Quote Originally Posted by FrontEnder View Post
    I was in the same situation last year and went through Freelancer financials, they advised the only lender who would accept based on my current contract would be Halifax. The gave me an agreement in principle, but only with a 15% deposit which scuppered my plans, so I didn't proceed.
    You also have to bear in mind each lender has their own criteria. Some will want you to be less than 50% through the contract, another won't accept anyone with gaps over a certain length in the last few years etc. Even if the numbers match and you have more than 15% deposit other criteria can come in from left field and trip you up.

    Having worked for a long time at a high street bank, I'm not at all surprised by this. Most lenders will asses you as self employed or company director, so with less than 2 years full accounts (most likely you haven't even filed your first year's yet), it will be very difficult.

    You'll have a lot more options when you've been going for longer than 2 years. A few lenders will be able to lend you based on your current daily rate, which means you'll be able to borrow more, but it's a big risk for the bank, so most will only do that with a good couple of years contracting history. Once you've been trading for 2 or 3 years, that will open up the market for you to traditional mortgage who can asses you based on your company accounts, but they won't lend you as much as the contractor specialists.
    I'm a little surprised by this. I remember when I was searching first time I went to a number of high street lenders and when I mentioned the less thank 1 year they said no problems, they'll just top up the 2 years with the information from perm employment. They seemed pretty clued up with the fact they'd need to speak to my accountant and the like. I just found I was spending an inordinate amount of time searching so went to Freelance Financials that did all that for me.

    I'm a little surprised by the comment regarding traditional mortgage lenders using company accounts. I thought most would be happy to speak to you about your income but the number of lenders actually going on contract rate or company accounts was still pretty low. It's not your money after all so is a big risk.

    Maybe things have changed in the last couple of years since I got my first contractor mortgage.
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    Quote Originally Posted by FrontEnder View Post
    I was in the same situation last year and went through Freelancer financials, they advised the only lender who would accept based on my current contract would be Halifax. The gave me an agreement in principle, but only with a 15% deposit which scuppered my plans, so I didn't proceed.

    Having worked for a long time at a high street bank, I'm not at all surprised by this. Most lenders will asses you as self employed or company director, so with less than 2 years full accounts (most likely you haven't even filed your first year's yet), it will be very difficult.

    You'll have a lot more options when you've been going for longer than 2 years. A few lenders will be able to lend you based on your current daily rate, which means you'll be able to borrow more, but it's a big risk for the bank, so most will only do that with a good couple of years contracting history. Once you've been trading for 2 or 3 years, that will open up the market for you to traditional mortgage who can asses you based on your company accounts, but they won't lend you as much as the contractor specialists.
    Thank you. I suppose this is what I was afraid to hear.

    Really started doubting about the whole mortgage idea now. Maybe it makes sense to wait until I at least file my 1st year contracting accounts before trying again

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