Mortgages for contractors

[Martin@AS Financial]

I cam recommend Martin@ASFinancials

Thats really kind - thanks Gables

[Zigenare]

Freelancer Financials - very helpful.

[NickFitz]

I went with Freelancer Financials - go via the Contractor Mortgages link over in the sidebar and I believe CUK gets a small cut, which helps keep the forum up and running (occasionally)

My position was that I was over 60 and had never previously had a mortgage, so I suspected I might have a bit of a rough ride going it alone. They sorted me out with an agreement in principle from the Halifax (that was considerably higher than I needed) within a few days. I missed out on the place I was looking at just then and didn't find anywhere else I liked for a month or two, but once I'd had an offer accepted, they got the confirmation of the mortgage within five days, which is Halifax's standard processing time. Just in time, as the confirmation came through the day before Liz Truss destroyed the economy!

All in all, I found them to be excellent, making a process I'd expected to be extremely stressful run very smoothly indeed. Well worth the approx. £600 they charged me back then; they also get a commission of some sort from the lender, but that's none of my business so I don't care about that

[swamp]

Complete Mortgages are very good.

[edison]

All brokers will receive a commission from a lender for arranging the mortgage, it is not a choice between whether they charge a fee to the client or take a commission from the lender. I think Ladymuck may be confusing the way a mortgage broker is remunerated with the way an Independent Financial Advisor is remunerated on something like a pension or investment plan, as they do either charge a fee or take a commission, not both (to my knowledge).

If a broker charges a fee, it is likely this will be on top of the commission, or procuration fee as it is known, that the lender gives to them. Whether the broker passes any or all of that procuration fee on to the client is up to the broker but to my knowledge, most do not pass it onto the client.

Some brokers charge a fee upfront (I believe this is how Cleerly may work?), others charge it upon issue of a mortgage offer and others charge it upon successful completion of the mortgage only (that's how we charge our fee for transparency).

Fees brokers charge do vary so perhaps speak to a few brokers. You may find you build a better rapport with one over another and are happy paying a slightly higher fee to go with your broker of choice or you may just wish to pay the lowest fee. There is no right or wrong.

What a broker can do for you is take away a lot of the stress and hassle. It's obviously our area of expertise so we will know all the lenders who can assist based upon your circumstances and requirements and which is the best one for you, offering the best mortgage.

The way I look at it is I could technically represent myself in court should I ever have to appear in court (hopefully I won't ever have to!) but it's not my forte so I would pay a Solicitor/Barrister to do it for me as after all, it is what they specialise in and it would very likely take them less time and be more accurate/successful than if I did it myself. That's not to say I couldn't do it myself though if I had the time and desire to do so but I'd rather put my time toward doing what I do best and leave the stress and hassle of something I have limited knowledge in, to a professional who specialises in it.

Aside from the time/hassle saving, us brokers do have access to lenders not available directly to the public and even with lenders who are available to the public we sometimes have exclusive rates we can access too which the public cannot.

Furthermore and quite possibly the most pertinent point at the moment with the way the market is right now, is that if you go direct to a lender like Halifax and submit an application on one of the rates they have available at that time, they would not normally let you know if they reduce their rates and a better rate becomes available to you. If you're looking to submit a remortgage application up to 6 months in advance of your current rate ending or going through a purchase application which is not likely to complete for a few months, that is a lot of time in the market where rates could come down. Any broker worth their salt would continue to monitor rates after the application has been submitted and notify you should something better came along. I have had a client where we managed to secure cheaper rates for them five times between submitting the initial remortgage application and when they eventually came to complete. The rate they ended up completing on was 0.86% cheaper than the original rate we submitted. The savings they made on those rate reductions over the duration of their mortgage rate, covered the broker fee we charged by a multiple of 25!

This is exactly what happened with me when I used a broker to get a mortgage, I ended up getting a substantially lower rate than the one on the original application. I've used a few different brokers as a permie and contractor and can recommend Freelancer Financials.

[TheMortgageSquad]

All brokers will receive a commission from a lender for arranging the mortgage, it is not a choice between whether they charge a fee to the client or take a commission from the lender. I think Ladymuck may be confusing the way a mortgage broker is remunerated with the way an Independent Financial Advisor is remunerated on something like a pension or investment plan, as they do either charge a fee or take a commission, not both (to my knowledge).

If a broker charges a fee, it is likely this will be on top of the commission, or procuration fee as it is known, that the lender gives to them. Whether the broker passes any or all of that procuration fee on to the client is up to the broker but to my knowledge, most do not pass it onto the client.

Some brokers charge a fee upfront (I believe this is how Cleerly may work?), others charge it upon issue of a mortgage offer and others charge it upon successful completion of the mortgage only (that's how we charge our fee for transparency).

Fees brokers charge do vary so perhaps speak to a few brokers. You may find you build a better rapport with one over another and are happy paying a slightly higher fee to go with your broker of choice or you may just wish to pay the lowest fee. There is no right or wrong.

What a broker can do for you is take away a lot of the stress and hassle. It's obviously our area of expertise so we will know all the lenders who can assist based upon your circumstances and requirements and which is the best one for you, offering the best mortgage.

The way I look at it is I could technically represent myself in court should I ever have to appear in court (hopefully I won't ever have to!) but it's not my forte so I would pay a Solicitor/Barrister to do it for me as after all, it is what they specialise in and it would very likely take them less time and be more accurate/successful than if I did it myself. That's not to say I couldn't do it myself though if I had the time and desire to do so but I'd rather put my time toward doing what I do best and leave the stress and hassle of something I have limited knowledge in, to a professional who specialises in it.

Aside from the time/hassle saving, us brokers do have access to lenders not available directly to the public and even with lenders who are available to the public we sometimes have exclusive rates we can access too which the public cannot.

Furthermore and quite possibly the most pertinent point at the moment with the way the market is right now, is that if you go direct to a lender like Halifax and submit an application on one of the rates they have available at that time, they would not normally let you know if they reduce their rates and a better rate becomes available to you. If you're looking to submit a remortgage application up to 6 months in advance of your current rate ending or going through a purchase application which is not likely to complete for a few months, that is a lot of time in the market where rates could come down. Any broker worth their salt would continue to monitor rates after the application has been submitted and notify you should something better came along. I have had a client where we managed to secure cheaper rates for them five times between submitting the initial remortgage application and when they eventually came to complete. The rate they ended up completing on was 0.86% cheaper than the original rate we submitted. The savings they made on those rate reductions over the duration of their mortgage rate, covered the broker fee we charged by a multiple of 25!

[ladymuck]

You mean Freelancer Financials?

I did!

[gables]

I cam recommend Martin@ASFinancials

[northernladuk]

Contractor Financials is a common broker that pops up round these parts

Yes, it's normal for a broker to charge a fee. There's two ways, in general, they can make money - by charging you a fee or by taking a commission. You could argue that you should get a more unbiased recommendation if you pay a fee rather than if they earn a commission.

If you go direct to the lender then you'd only expect to pay the arrangement fee.

Some lenders don't deal direct with the public and will only work via brokers so the value to you is whether you think Halifax will get you a better deal than one of these lenders

You mean Freelancer Financials?

[northernladuk]

I've always used Freelancer Financials. We could name a few providers but each has certain lending criteria like how long left on a contract or no gaps in the last 2 years and so on so I couldn't be bothered wading through them all. CF will take your details, go to all the contractor friendly lenders and do the legwork for you.

[eek]

Also the fee will very likely match (or be less) than the commission they would otherwise receive.

[ladymuck]

Contractor Freelancer Financials is a common broker that pops up round these parts

Yes, it's normal for a broker to charge a fee. There's two ways, in general, they can make money - by charging you a fee or by taking a commission. You could argue that you should get a more unbiased recommendation if you pay a fee rather than if they earn a commission.

If you go direct to the lender then you'd only expect to pay the arrangement fee.

Some lenders don't deal direct with the public and will only work via brokers so the value to you is whether you think Halifax will get you a better deal than one of these lenders

[Dhrucku]

does not compute

Milan.

??

[milanbenes]

does not compute

Milan.

[Dhrucku]

Is there a certain company you guys would recommend if going for a mortgage as a contractor (going for a joint one with my OH who is a Permie). Will be approaching cleerly who seem to be a name I've heard many people mention.

One of the other questions I had was cleerly do ask a fee I think it's around £750-800. Is this worth paying as they have better access to the market than say Halifax (a known contractor lender)?