Contractor Mortgages - What are they like...any good?

[morf]

I've been using Paul @ My Contractor Mortgage and have been very pleased with him. Great service. Seems like rates are still dropping for bigger loans (Just had a quote drop from 2.24% > 1.79%!)

[d000hg]

I was amazed to end up getting 1.59% with only 70% LTV.

[BolshieBastard]

Mine's not a 'contractor' mortgage as such. Its a rapid repay facility with a bank that's very similar. Best of it is, it doesnt show up on any mortgage search so Im effectively mortgage 'free.'

Dumped all savings and spare cash into it so have a massive drawdown facility any time I want and dont need to ask the bank for a 'loan' etc.

Best thing I ever did.

[morf]

I was amazed to end up getting 1.59% with only 70% LTV.

Halifax just dropped to 1.79% at 75% LTV even on a big loan (over 500k!)

[AnotherGuy]

Hi,

Do mortgage brokers or banks take into consideration the fact that you *could* buy a property with cash straight away, but you are not doing it, instead you're asking for a small mortgage, let's say 35% and will they give you advantageous conditions because of this?

Do these "advantageous conditions" include the ability to get that mortgage if you only have a few months of company accounts?

Thanks.

[Power Mortgages Ltd]

Hi,

Do mortgage brokers or banks take into consideration the fact that you *could* buy a property with cash straight away, but you are not doing it, instead you're asking for a small mortgage, let's say 35% and will they give you advantageous conditions because of this?

Do these "advantageous conditions" include the ability to get that mortgage if you only have a few months of company accounts?

Thanks.

Hi AnotherGuy,

Unfortunately lenders do not take into consideration if you could buy the property outright, they have to assess your ability to maintain that mortgage when they lend it to you.

Using random figures, if you were buying a property for £100,000 and you have £100,000 in savings but wish to keep £35,000 back so look to apply for a mortgage of £35,000blm, the lender could obviously see you have the ability to purchase the property outright but they don't know that the 35% (£35,000) you are holding back isn't going to be spent in other areas,

The fact you only have a couple of months Ltd co accounts does not necessarily mean a lender wouldn't be able to assist anyway. If you have been contracting long enough then you could actually source funds based upon a multiple of your contract rate.

Hope that helps?

[AnotherGuy]

Thx Power Mortgages Ltd,

That makes sense.

What do you mean by "If you have been contracting long enough then you could actually source funds based upon a multiple of your contract rate."?

The rate in my case would not be a problem but unfortunately I'm quite new to contracting (less than 2 months). I've been perm for several years in my previous company if that helps...

[Power Mortgages Ltd]

Thx Power Mortgages Ltd,

That makes sense.

What do you mean by "If you have been contracting long enough then you could actually source funds based upon a multiple of your contract rate."?

The rate in my case would not be a problem but unfortunately I'm quite new to contracting (less than 2 months). I've been perm for several years in my previous company if that helps...

Hi AnotherGuy,

There are a few lenders who need you to have been contracting a certain amount of time but even if you have been contracting only a couple of months there are still options available if you have been in the same line of work, albeit on a permy basis, for the past couple of years. The choice is a little more restricted but there are still options.

Hope that helps?

[shelby68]

1st Mortgages at Thirsk

I've just got a contractor mortgage though 1st Mortgage services at Thirsk, Julie there sorted me out very quickly with a good deal (and that was on a listed building just to complicate things).

Rates seem pretty reasonable as well she only charged me 150 quid plus whatever she gets from the mortgage company and she deals with a lot of contractors she tells me.

[foobar]

Contractor Mortgages Made Easy - No probs.

CMME were very good. No problems.

Anyone going with CMME, PM me first and I will split the referral fee with you 50:50. </noshame>