Getting a mortgage as an IT contractor
Discussion
Finally decided that I should probably think about jumping on the property ladder. Still haven't decided if the market is up/down/sideways but I've been thinking about mortgages.
I know a whole load of you guys are Contractors and this place is always a wealth of knowledge. Just wondered if any of you have had experience of trying to get a mortgage as a contractor (specifically with only a couple of years as one)? Not done a whole lot of investigation yet but I've heard rumours that the high street banks can be a pain, but there are 'specialists' we can go to.
Anyone got any experience of this? Whats the score?
Cheers
I know a whole load of you guys are Contractors and this place is always a wealth of knowledge. Just wondered if any of you have had experience of trying to get a mortgage as a contractor (specifically with only a couple of years as one)? Not done a whole lot of investigation yet but I've heard rumours that the high street banks can be a pain, but there are 'specialists' we can go to.
Anyone got any experience of this? Whats the score?
Cheers
Try checking the info on the dedicated Contractor sites such as Contractor UK and Shout99, here are a couple of links to be going on with...
www.contractoruk.com/money/index.html
www.contractormoney.com/contractormortgages.html
www.shout99.com/contractors/
It would appear from the quick glance that I've just had that there are an increasingly varied set of options open to you.
www.contractoruk.com/money/index.html
www.contractormoney.com/contractormortgages.html
www.shout99.com/contractors/
It would appear from the quick glance that I've just had that there are an increasingly varied set of options open to you.
Gaffer said:
A friend recommended a company called Northern Rock.
They specalise in Contractors and first time buyers. Will give up to 6 times your salary to get you started.
Claire
careful with this - not always true in every circumstance (disclaimer: I used to work for them as a registered mortgage advisor) they definitely are not the best for self employed of FTB, they have recently tightened up their requirements on self cert to the point where they are now wholly uncompetitive and they have no specific FTB deals like some banks I could mention.
best advice is to speak to a broker, if you are a specialist client they will be able to put you to a specialist packager who will use their expertise to liase with the lenders to find you the most competitive deal out there. whatever you do make it an independent broker - no point being ignorant of all the deals available on the market, it surprises me how many people will willingly go to their own bank rather than see what's out there.
Gaffer said:
Ok thanks for that. She is works for an estage agent and get a lot of people buying who have used Northen Rock.
The RBS wont touch me even for a loan as I am a contractor. Gets a bit frustrating to be honest.
I only want a small amount and would pay it back in a year or so.
Claire
fairy nuff
a lot of people use NR because they will give an unsecured loan on top of the mortgage (depending on the deal) at the same rate over the same term which allows purchasers to consolidate other debts. they will (in certain circumstances) offer up to 6X income, but it depends on whether you can jump through all their hoops - i.e. do you earn over 30k each, are you a joint or single app, do you have less than 65% LTV, do you have a high credit score, are you taking a fixed rate of at least 5 years......those are some of the hoops you must jump through. there are more which if you can pass they will let you have 6X. it all depends on an underwriter at the end of the day so it's by no means guaranteed. however I know the chief underwriter 
so i'm all right jack sorry for the long post but it's the only type of thing i'm really knowledgeable about and I like to try to help
>> Edited by minimax on Thursday 3rd March 19:11
minimax said:
fairy nuff
sorry for the long post but it's the only type of thing i'm really knowledgeable about and I like to try to help
>> Edited by minimax on Thursday 3rd March 19:11
Err...I think I understood the first sentance then the rest went right over my head.
Claire
dern said:
I've had no problems with Nationwide. You'll need to provide proof of income though such as accounts and such.
Good luck,
Mark
or alternatively you can use UCB HomeLoans who are nationwides' subsidiary specialising in self certs. they are much more flexible
>> Edited by minimax on Thursday 3rd March 20:22
The market has relaxed enormously in recent years.
When I got my first mortgage as a contractor (about 5 years ago) pretty much the only option was a broker who knew the ropes, or else full self-employed mortgage with the requirement to provide 3 years company accounts etc.
Self-Cert has been brilliant as you can pretty much dispense with all but current rate.
A broker will almost always be able to get you the best deal, but there's no reason why you can't approach a lender directly (eg. Northern Rock).
We're currently with Northern Rock, but our previous product was Woolwich Open Plan which was a far superior product and the only reason we left was to rate tart across to NR to raise some equity for a project.
When I got my first mortgage as a contractor (about 5 years ago) pretty much the only option was a broker who knew the ropes, or else full self-employed mortgage with the requirement to provide 3 years company accounts etc.
Self-Cert has been brilliant as you can pretty much dispense with all but current rate.
A broker will almost always be able to get you the best deal, but there's no reason why you can't approach a lender directly (eg. Northern Rock).
We're currently with Northern Rock, but our previous product was Woolwich Open Plan which was a far superior product and the only reason we left was to rate tart across to NR to raise some equity for a project.
You keep using the term contractor. I presume like myself you are self employed. It really is not such a big deal nowadays, especially with a culture where organisations are tripping over themselves to lend you money.
You'll probably need to prove income for a number of years. Most lenders will include share dividends as well as salary.
pp
You'll probably need to prove income for a number of years. Most lenders will include share dividends as well as salary.
pp
Bizarrely, went I first went into business I needed a larger mortgage and it was a nightmare to get one because I couldn't prove long-term employment. The reason it was bizarre was that one or two of the people that worked for me got mortgages okay - after the mortgage companies had written to me confirming I was their employer.
Pickled Piper said:
You'll probably need to prove income for a number of years. Most lenders will include share dividends as well as salary.
I can think of a few lenders who will work from 1 years accounts plus a projection for the next year, the normal minimum is 2 years plus a years projection though.
or if you have 15% deposit you can self cert for almost the same rates as prime customers
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