Buying your first home is both daunting and stressful, whether you’re contracting or employed. There’s so much you feel you should know (but don’t), it can be overwhelming.
We get it. So we’re here to help first-time home buyers who just happen to be contractors, too.
With so many different mortgage options, how do you figure out where to start looking?
You weren’t born with an inherent knowledge of mortgage finance. Yet many of us feel that we should know more about how they work than we do.
This is why specialists like us exist: to pave the way for a smooth transition. We’ll take you from homeowner newbie to mortgage loan aficionado in three minutes flat.
Contract-based underwriting helps eradicate the usual limitations
You may be looking for a base that doubles up as your home office, a starter home or just somewhere to call your own. But how can you buy when High Street banks don’t understand your contractor status or financial accounts?
Whatever your housing needs, we’ll help you onto the property ladder using your contract. There’s no skulduggery involved. We use a tried and tested method called contract-based underwriting. This method works for first time buyer mortgages as well as our other contractor mortgage products.
Knowing that you’re buying a home that you can afford is one less thing to keep you up at night. We want to make those sweet dreams of first time home ownership a reality for you.
How the First Time Buyer market has changed
Before the credit crunch, first-time homebuyer mortgages were pretty straightforward to secure. By self-certifying earnings, even those newest to contracting could get on the property ladder.
But as the recession’s grip tightened, one trend began to take precedence. Many who’d recently bought their first home were struggling to meet their monthly repayment.
Worst still, between buying their home and coming to sell it, it had slipped into negative equity. They became known as mortgage prisoners and were amongst the credit crunch’s first casualties.
As a result, the days of self-cert mortgages came to an ungraceful end. Lenders who’d lent five, maybe even six times a contract value withdrew those products. And we hope, never to return.
Don’t confuse self-cert with self-employed mortgages
Unfortunately, self-employed mortgages got tarred with the same ‘self-cert’ brush. But self-cert mortgages and self-employed mortgages are not the same!
25% deposits became the least a borrower would have to find. That ballooned to even more in given circumstances.
There was an upside, but only a small one. The amount you can afford to put down as a deposit affects your monthly payment over the term of the mortgage loan.
With greater deposits comes a lower monthly repayment. But it was the initial barriers that stopped contractors from securing a first mortgage.
Contractors today reaping the fruits of our labour
On top of self-cert disappearing, the (then) FSA reined in interest-only mortgages, too. With fluctuating income, this was the contractor’s staple home loan product.
Enough was enough. In 2010, we decided to take action. And, boy, how contractors from all walks are reaping the dividends today. No pun intended.
We went beyond the front desk, a contractor’s first fatal hurdle. We sat down with mortgage lenders and explained to them how contracting works. Some listened and took action.
Today, we call those pioneers ‘contractor friendly’ lenders. They welcome seasoned professionals as well as first time buyers.
With them, we negotiated special underwriting terms. These terms include for our first-time homebuyers. And we’re confident that you won’t find their like anywhere else on the High Street.
Benefits of securing your first home through Contractor Mortgages®
We’ve been dealing with all manner of independent professional for years. Even umbrella employees can leverage our expertise in obtaining mortgages for contractors.
Please, feel free to try out our contractor mortgage calculator. That will give you an idea of how much you can borrow using your contract rate.
In the meantime, here’s an overview of what you get with our service. They’re a few more reasons why you’d trust us with your first time buyer mortgage application:
- secure a competitive mortgage with as little as 5%-10% deposit;
- affordability assessed on your contract rate alone (not accounts);
- mortgages of up to five times your annualised contract income;
- discounted or zero set-up fees (on selected and often exclusive offers);
- we keep you updated on your application every step of the way.
Why Contractor Mortgages® are different
We make the process of arranging your first mortgage painless and hassle free. As a contractor, you may feel that securing competitive interest rates is impossible. It’s not.
Many High Street lenders offer awful terms for contractors. They base their offer on the irregular nature of a contractor’s work and income. It’s ill advised and needn’t be the case.
We understand how you work and how to package your application so that our underwriters see it, too. Armed with this knowledge, we work to bring contractors the most competitive mortgage deals.
Besides the benefits we’ve already listed, our first time buyer contractor mortgage service includes:
- a low mortgage broker fee; most specialist brokers charge a flat fee of £900;
- as an independent mortgage broker, we can offer the widest possible market selection;
- affordable mortgage protection & critical illness policies;
- priority mortgage applications for those with tight deadlines (3-5 weeks is the norm!);
- a personal account manager who’ll be there for you from application to completion.
Whether you’re a limited company contractor or a PAYE umbrella worker, we can help.
From the outside looking in, contractor mortgages may seem dead in the water. It’s just not so. On the inside, we know that even first-time buyers can secure that elusive mortgage.
Sacrificing high take home pay for tax planning needn’t mean going without a mortgage. Haven’t you sacrificed enough already to get where you are? Then securing your first mortgage as a contractor will be a doddle.
