"Is it realistic for me to secure a mortgage. I worked as a contractor in 2014. I worked for a bit in 2015 but took most of the year off. I have started contracting again in 2016. Earnings are £80K (2014), £20K (2015) and £80K (2016 estimate). I have not started looking for a property because I want to get an idea of whether I would qualify. My plan would be to save for the deposit in 2016 and look to buy in 2017."
Thank you for your enquiry via our ‘Ask the Experts’ section of our website.
It's certainly true that are a number of specialist lenders who have specific criteria for contractors, and there are also lenders who manually underwrite cases, who will look at contractors a little more sympathetically than the high street tends to. The majority of banks and building societies will always class contractors as self-employed if you are on a fixed term contract and you invoice an employer via your own Limited Company.
If you are an employed contractor and have a job for a set period, you will need to provide a copy of your current contract at the time of application, the lender would use this to prove your come.
The lender may also want to see a copy of your CV showing your experience in order that they are comfortable with future re-employment, it would be useful to know which industry sector you contract for as that can influence a lender’s decision. The lender may also want you to confirm what you were doing during your time off in 2015.
As this is a purchase, it's important to remember that you would also need to factor in buying costs such as solicitor’s fees, stamp duty and agent fees.
As an Independent mortgage broker we have access to a wide range lenders including those that still judge each application on its individual merits, so we who would be able to recommend the most suitable lender based upon your individual circumstances. I suggest that the next step would be to discuss your enquiry in more detail once you have saved funds for your deposit and you are actively looking at suitable properties.
Answers provided in response to Ask the experts are based on the information provided and do not constitute advice under the Financial Services & Markets Act. They reflect the personal views of the authors and do not necessarily represent the views, positions, strategies or opinions of John Charcol. All comments are made in good faith, and John Charcol will not accept liability for them.
We recommend you seek professional advice with regard to any of these topics where appropriate.
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