Contractors – less of risk than many permanent workers
As a contractor, you may discover that finding a loan is a difficult, complex and drawn out process. All lenders are looking for security. The fact is that permanent employees who receive the same sum of money into their bank account each month are viewed as a lower risk by most providers. On the other hand, contractors often receive differing sums each month and even none at all in some months! In the current economic climate, traditional lenders often look for reasons not to lend, rather than seeking out available low-risk lending opportunities. For contractors, this often means the dreaded ‘computer says no’ response when approaching a lender directly for a loan or mortgage borrowing.
Most lenders fail to recognise that contractors can prove to be less of a risk than permanent workers. This is because many contractors have a higher income and possess a wider, more marketable skill set that can help them continually secure work. They are also often able to keep up their mortgage repayments without problems when their current contract comes to an end.
Contractors Looking for a Mortgage or Loan – higher incomes, wider skills but proof of income?
Proof of income can be difficult as lenders like to see payslips to approve a loan or mortgage. For contractors that choose to work through a limited company, payslips in isolation are not a good guide as much of the income may be in the form of dividends (which some lenders may not recognise in full). Working through an umbrella can sometimes help as you are provided with regular income with actual salary rates. Securing your loan against an asset can provide the answer, though as with a mortgage, you need to remember that if you don’t keep up repayments that asset may be at risk.
Bespoke & Flexible Underwriting Terms For Contractor Mortgages
The Contractor Mortgage Company has access to many lenders who are experienced in dealing with contractors, a great help when you are looking for the right loan at a competitive rate. At The Contractor Mortgage Company, we understand the difficulty many contractors can face in securing a competitive mortgage because lenders often view them as a risk. However, we don’t believe hard-working contractors should be penalised for being entrepreneurial, compared to full-time employees, when trying to arrange mortgage funding. We have worked hard to persuade lenders to take a more flexible approach when looking at mortgages for contractors and, as a result, we are able to arrange bespoke underwriting terms with a number of lenders, specifically for contractors.
If you are a contractor trying to secure a loan or get a mortgage arranged, come and talk to us. We are professional mortgage advisers and have access to a wide range of products. We can ensure you get the most suitable loan or mortgage to meet your needs. Call os on: 0330 088 1260