Contractors and Self Employed

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Lots of people think it’s harder to get a mortgage if you are a Contractor or self-employed.

But, don’t worry! It doesn’t have to be! With more and more of the population deciding to become their own boss lately it is important to know how it affects your borrowing ability.

In short, it is no harder to get a mortgage if you work for yourself or, have own your own company, we just need different information for an application. You will generally need a couple of years trading history to get a mortgage. This is what tends to catch most people out. There are certain exceptions to that though, depending on what you do and even what you did before.

If you are a contractor, more and more lenders now are willing to look at the value of your contract rather than view things with traditional self-employed criteria. Again, it depends on what you do and how long you have been doing it.

You may be surprised at what is possible!


How many years’ accounts do I need?

Generally 2 as a rule of thumb but there is the odd lender that might not need this depending on what you do.

Do I need a specialist lender if I am a contractor?

No, not usually, although some lenders are more used to dealing with this type of income, there are some very familiar names that have specific criteria if you are a contractor. Some lenders will be able to use the value of your contract rather than the income from your tax returns.

Does being self-employed affect the amount I can borrow?

No, not necessarily. Just like if you are employed, the more you earn, the more you are able to borrow. It is just important to remember that in most cases the lender will take your net profit or salary and dividends and not your turnover. There are a couple of lenders that may also take in to account the profit of the business.

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