Contractor Mortgage potential problems?

[Emma Power Mortgages]

Thanks for your reply Northernladuk. I've heard that the Halifax is a popular one. Do I need to have accounts for the application process? Or is my contract and 3 months bank statements enough? Now that I think about it I think my longest gap has been 4 months and that was my most recent one. Does the broker charge a fee for the advice or only if you go ahead with the product that they offer?

You shouldn't need accounts unless they are trying to utilise self employed criteria (this is sometimes an option for contractors but not the usual way to go). It will most likely depend on the lender they put you with, they do reserve the right to ask you for anything.

Most will charge a fee for the application, some on application, some, more preferably, on completion. I wouldn't pay a fee for the advice, that part should be free.

[Emma Power Mortgages]

Hi everyone,

I have been contracting for nearly three years now and looking to get a mortgage shortly but thinking of potential problems that may hinder the application process.

I have had gaps between each of my contracts over these 3 years and that's just been down to the time it has taken to secure new contracts. These gaps range between 1 to 3 months. I have recently secured a new contract for 6 months paying £325 daily. When I apply for the contractor mortgage do I mention the gaps over the 3 years of contracting or does that not matter as I have a new contract for 6 months?

My partner is permie and we would like to go forward for a joint application but her credit history is poor (has taken out pay day loans in the past) and has a few defaults. Would it be more beneficial for me to go for a contractor mortgage on my own? Obviously my partner would be helping with mortgage repayments but can some sort of contract be drawn up for this arrangement?

My deposit is £90,000 at the moment but looking to put down around £100000 to buy a £350000 new build home.

Any advice is appreciated and any recommendations for brokers please?

Thanks in advance!

Tell your broker about the gaps, without the whole picture they are unable to give you the correct advice and if it comes out later down the line they may of made an application to the wrong lender wasting your time and money. Some lenders allow for 12 weeks in the last 12 months and some are more flexible with larger deposits there are a lot more options for contractors than there used to be.

With your partners history if you send your credit reports to the broker they should advise you on both scenarios and as to what is possible and what affect (if any) it may have on your rate.

[WTFH]

The £100,000 deposit on a £350,000 is what will work best in your favour - you're below 75% LTV, so more lenders will be open to you. Speak to a few brokers and see who comes back with the results. If you search on here you'll find several threads about it listing various options.
I would recommend using a broker. It may cost you marginally more, but you'll be getting advice from people who know what they are doing, rather than trying to do it yourself.


Be prepared to supply lots of paperwork. It's a few years ago, but at the time I was asked for credit card statements proving my address and that that cards were being paid off going back 5 years along with utility bills and bank statements.
Frustrating, but it got me the mortgage pre-approved and then buying the house became simple.

[northernladuk]

I don't know about mixing up permie salary and contract as I had 2 years contracting. I'd imagine they will just go on the rate so you'll be OK. Banks can handle a mix of perm and contract income now anyway.

Freelancer don't charge for advice. I've put a couple of ideas past them in the past and added in some circumstances what I wanted to do wasn't worth it. Dunno if they charge for a failed application but I doubt they will let it get that far without telling you.

The Enact conveyancing derive Halifax use is pretty slick. All online via a portal so pretty clear.

[Dougie800]

You just have to speak to a contractor broker and put it to them. Each of the lenders has different criteria. Some won't like the gaps (virgin I think) other just want to see you are in a gig and are less than halfway through the term (or something like that). Just speak to the brokers and let them do the work for you.

Speak to Freelancer Financials. I've had a number of mortgages through them. I had a three month gap in the last 15 months and just flew through a mortgage with the Halifax.

Thanks for your reply Northernladuk. I've heard that the Halifax is a popular one. Do I need to have accounts for the application process? Or is my contract and 3 months bank statements enough? Now that I think about it I think my longest gap has been 4 months and that was my most recent one. Does the broker charge a fee for the advice or only if you go ahead with the product that they offer?

[northernladuk]

You just have to speak to a contractor broker and put it to them. Each of the lenders has different criteria. Some won't like the gaps (virgin I think) other just want to see you are in a gig and are less than halfway through the term (or something like that). Just speak to the brokers and let them do the work for you.

Speak to Freelancer Financials. I've had a number of mortgages through them. I had a three month gap in the last 15 months and just flew through a mortgage with the Halifax.

[Dougie800]

Hi everyone,

I have been contracting for nearly three years now and looking to get a mortgage shortly but thinking of potential problems that may hinder the application process.

I have had gaps between each of my contracts over these 3 years and that's just been down to the time it has taken to secure new contracts. These gaps range between 1 to 3 months. I have recently secured a new contract for 6 months paying £325 daily. When I apply for the contractor mortgage do I mention the gaps over the 3 years of contracting or does that not matter as I have a new contract for 6 months?

My partner is permie and we would like to go forward for a joint application but her credit history is poor (has taken out pay day loans in the past) and has a few defaults. Would it be more beneficial for me to go for a contractor mortgage on my own? Obviously my partner would be helping with mortgage repayments but can some sort of contract be drawn up for this arrangement?

My deposit is £90,000 at the moment but looking to put down around £100000 to buy a £350000 new build home.

Any advice is appreciated and any recommendations for brokers please?

Thanks in advance!