Reply to: Can't get mortgage after contract break

[Hobosapien]

If the mortgage provider is willing to accept current contract rate to base their lending criteria on, and no contract is worth more than the notice period, why does it matter what happened prior to the current contract in terms of gaps on CV?

It would make sense if not in current contract after a significant time since previous contract but if currently in a contract it defies logic to me.

[NorthWestPerm2Contr]

Not necessarily. Remember not everyone on here has the same skill set.

Most lenders will not go into that much detail, understandably.

[SueEllen]

I agree but if you are a lender you will view that as being problematic since it is more difficult to get a contract after such a break........

Not necessarily. Remember not everyone on here has the same skill set.

[NorthWestPerm2Contr]

Why not?

You only live once.

I agree but if you are a lender you will view that as being problematic since it is more difficult to get a contract after such a break........

[SueEllen]

6 month is quite a break to be fair....

Why so long? Could have done a month here and there.

Why not?

You only live once.

[NorthWestPerm2Contr]

6 month is quite a break to be fair....

Why so long? Could have done a month here and there.

[blackeye]

Have a chat with Super Contractors. I can't recommend them enough.

I had a 8 month break with only 2 years of contracting experience and they have got me a mortgage offer (not just in principle, an actual offer).

Contractor Mortgages said they wouldn't be able to get me a mortgage too. Plus they have the nerve to charge about a £1000 (plus the commission they get from the lender), whereas Super Contractors get their commission from the lender and won't charge you anything.

[rapid]

I came out of a 20 month contract, took 17 weeks off, took on a new contract and managed to secure a mortgage with clydesdale (late last year).

However I did have to put in a 20% deposit.

I can highly recommend Dan@Power Mortgages, vert thorough and got me out of the sh!t when another highly recommended broker was taking me for a ride..

Best of luck, give Dan a shout.

[Martin@AS Financial]

I took a 5 month break out to do some volunteering. Because of this, according to Contractor Mortgages, no lenders will lend to me. One will lend after a 6 month unbroken gig, the rest after 10. I'm 1 month into a 6-monther.

Has the same happened any of you?

As a contractor, you have 2 bites of the cherry as so to speak when it comes to applying for a mortgage. As you already know, using the gross value of the daily rate is not currently an option due to the break.

However, you can also present yourself as self employed by using the ltd co salary and dividends. Essentially to go down this route, it is worth preparing the last 3 years SA302's, Ltd Co accounts and tax overviews. When looking at your accounts, banks want to ensure that:

- Your company has not made a loss or seen a significant decrease in profit

- You have not paid yourself out of retained profit (the dividend figure should not be higher than your net profit)

[Big Blue Plymouth]

Bit off the original topic but..

Interesting, that's exactly where and what we're looking for at the moment.. about to put our place on the market (Central South) with a view to moving to the South West. The various agents we had in to do "valuations" all suggested the market had flatlined or even dipped a bit in last six months, the values they came up with weren't much different to a year ago..

The problem is that there are one or two perceived hotspots where agents think they can cash in on the many Londoners moving to the area; Frome and Bruton,to name a couple.

I've seen stuff that was on the market last year come on again this year at 25% higher prices without any improvements being made. They're simply not worth it.

As soon as you move west beyond Wells or south into Dorset you get much more bang for your buck.

Glad I'm away from all that madness now. Good luck!

[Dark Black]

Bit off the original topic but..

Interesting, that's exactly where and what we're looking for at the moment.. about to put our place on the market (Central South) with a view to moving to the South West. The various agents we had in to do "valuations" all suggested the market had flatlined or even dipped a bit in last six months, the values they came up with weren't much different to a year ago..

It took me 2 years in total to move.

Having had my eye on the market all that time I can say there is very little on offer and what is there is ridiculously overpriced. Stuff hangs around for months until the price comes down to something more reasonable.

I think this is a trend that will continue as there's even less on the market now since the uncertainties over Brexit.

This is the market for rural properties in the South West. Other areas may be different.

[Big Blue Plymouth]

To be honest, the news wasn't too disappointing. Even if I started looking for a property now, it's unlikely I'd have found anything I want to buy (I'm very picky and not in a hurry). Plus, with Brexit, in 6 months I'll have a better idea of where prices are going. If they rise a lot and I miss out, then so be it.

It took me 2 years in total to move.

Having had my eye on the market all that time I can say there is very little on offer and what is there is ridiculously overpriced. Stuff hangs around for months until the price comes down to something more reasonable.

I think this is a trend that will continue as there's even less on the market now since the uncertainties over Brexit.

This is the market for rural properties in the South West. Other areas may be different.

[heyya99]

I've recently been through all this myself.

In short, I had a mortgage offer approved based on my day rate.

Sold my house, found a property and had my offer accepted. Fast forward a few months and the purchase fell though. Then a few months on the bench pushed me over the 3 months in the last 12 that most lenders seem to consider acceptable.

I was looking at going back into long term rental.

Fortunately, Freelancer Financials got me a really competitive deal based on 3 years accounts. Admittedly, I wasn't after a very big loan and I think if you are going for a big mortgage you probably will need something on your day rate.

Unless you're desperate to move or you've found your dream property, I'd just sit tight, stay in contract and wait until you're back in the black in terms of months on the bench.

To be honest, the news wasn't too disappointing. Even if I started looking for a property now, it's unlikely I'd have found anything I want to buy (I'm very picky and not in a hurry). Plus, with Brexit, in 6 months I'll have a better idea of where prices are going. If they rise a lot and I miss out, then so be it.

[Big Blue Plymouth]

I've recently been through all this myself.

In short, I had a mortgage offer approved based on my day rate.

Sold my house, found a property and had my offer accepted. Fast forward a few months and the purchase fell though. Then a few months on the bench pushed me over the 3 months in the last 12 that most lenders seem to consider acceptable.

I was looking at going back into long term rental.

Fortunately, Freelancer Financials got me a really competitive deal based on 3 years accounts. Admittedly, I wasn't after a very big loan and I think if you are going for a big mortgage you probably will need something on your day rate.

Unless you're desperate to move or you've found your dream property, I'd just sit tight, stay in contract and wait until you're back in the black in terms of months on the bench.

[SuperZ]

I do wonder sometimes why the government hasn't clamp down on fixed rate mortages as many could be caught out with this and lumbered with a high APR mortgage once the term ends (unable to move to a better deal). The purpose of fixed rate mortgages I thought was meant to be to help home owners starting out after buying a home so they can buy furniture etc. TOday people jump from fixed rate to fixed rate mortgage to escape the stupdily high APR after the fixed term is over.

Whether a new buyer or remortaging, best of luck.