Does taking an Inside IR35 contract have impact on any future mortgage applications?

[BritishLad88]

Does anyone know if Inside IR35 contracts are treated the same as outside IR35 contracts in regards to making future mortgage applications (be it new or remortgage)?

I'm planning to look to remortgage when my existing mortgage deal expires in the next 2 years and will be looking to purchase a new property as a result so would be making mortgage applications.
I was wondering if i take on an Inside IR35 contract now (or anytime between now till when i look to mortgage) would it have an impact (negatively?) on my application?

I'm aware that lenders look into your affordability at the end of the day but was thinking would they see you as a high risk like an outside IR35 contract would since Inside IR35 contract is contracting at the end of day despite having an element of "fixed-term" associated to it.

[ladymuck]

I don't see why it should. You're an employee of either the agency (if they're running payroll) or an umbrella. You'll have pay slips and and P60 showing your earnings and that's what the affordability checks will be on.

[northernladuk]

Been asked a ton of times. Here are all the threads related to mortgages and inside IR35

https://www.google.com/search?q=insi...hrome&ie=UTF-8

[BritishLad88]

I don't see why it should. You're an employee of either the agency (if they're running payroll) or an umbrella. You'll have pay slips and and P60 showing your earnings and that's what the affordability checks will be on.

That's a fair point. I guess if you have payslips then it doesn't matter if you're a full-time employee of a company or on an Inside IR35 contract as at the end of the day you are viewed as an employee i suppose. So it doesn't matter on your employment contract type.

[BritishLad88]

Been asked a ton of times. Here are all the threads related to mortgages and inside IR35

https://www.google.com/search?q=insi...hrome&ie=UTF-8

Thanks for the old thread. That's very useful indeed.

Yeah i did spent ages searching on this forum using the search bar on the top right of this page but didn't return any useful threads at all (certainly not that thread you just posted). Maybe the search feature of this forum could do with an upgrade.
Plus i thought i gave it another shot at asking this topic again since things might have changed since (I know mortgages processes/rules have certainly changed a lot over the last few years because of the pandemic).

[ladymuck]

The search has always been crap on this forum. Your best bet is to use the Google search method

site:forums.contractoruk.com keyword1 keyword2

[WTFH]

I'm planning to look to remortgage when my existing mortgage deal expires in the next 2 years and will be looking to purchase a new property as a result so would be making mortgage applications.

Are you looking to:
a) remortgage and keep existing house
b) get a new mortgage on an additional house
c) sell existing house and buy new one

If the answer is c, then I'd hold off on switching mortgage deals if you are hoping to sell soon after that. Many deals have tock-in periods and fees, which means the saving of a few quid a month for a couple of months is offset by the cost of getting out or changing.

Also, are there any other salient points you're not telling us, such as if you're if you're wanting to buy an Audi Q4 on lease...

[BritishLad88]

Also, are there any other salient points you're not telling us, such as if you're if you're wanting to buy an Audi Q4 on lease...

Haha, i was hoping to omit certain info which i felt would be pointless for the topic i was asking about..

Are you looking to:
a) remortgage and keep existing house
b) get a new mortgage on an additional house
c) sell existing house and buy new one

If the answer is c, then I'd hold off on switching mortgage deals if you are hoping to sell soon after that. Many deals have tock-in periods and fees, which means the saving of a few quid a month for a couple of months is offset by the cost of getting out or changing.

Not too sure right now, it might be a few years away but i'm merely just planning ahead. I might buy a new one and keep my existing one & convert my existing mortgage to be a buy-let one. It might get complicated... hence why i left this info out deliberately in my OQ. But let's see.

[WTFH]

Not too sure right now, it might be a few years away but i'm merely just planning ahead.

Don't choose interest only, unless you want to stay with mortgages until you can afford to downsize.
Instead, get an offset tracker. Pay down the loan with any spare funds you have.

Then, in how ever many years time you choose to buy somewhere else, you'll have more equity from the existing property.

[ladymuck]

Don't choose interest only, unless you want to stay with mortgages until you can afford to downsize.
Instead, get an offset tracker. Pay down the loan with any spare funds you have.

Then, in how ever many years time you choose to buy somewhere else, you'll have more equity from the existing property.

+1 for an offset mortgage

Brilliant product to have, especially at the moment when earnings on savings are so rubbish.

Also make overpayments as much as you can, when you can. Some mortgages have limits on how much you can overpay in a year so be wary of that to avoid charges.