All you need to know about contractor mortgages
Before you borrow a contractor for your future mortgages, here are a few things you should definitely know about them. Contractor mortgages are quite an essential these days and must be hired if you havent bought a home yet. Keep reading the post to find out more about them!
The different kinds of contracts found under mortgages these days include self employed contractors that have around six months of proper working history. Secondly, it could be a short term contractor who has experience from before. Third, it could be contractors of employees from different umbrella companies. Fourth comes zero hours contracts which have at least six months of working history and experience. Fifth, there are agency workers who have 12 months of working history almost.
How should you borrow as a contractor?
By finding out how much you are able to borrow being a contractor who is looking for a mortgage can be hard as most lenders will use a separate method and also accept all kinds of incomes. If you are using an employed contract, it is usually just like your gross salary along with some additional bonus. The contractors who are self employed will have many specialist lenders will also calculate the annual income by boosting the day rate of contract by the number of days which has been worked every week by forty eight hours.
Contract mortgages in the UK
Contractor Mortgages . in the UK are often looked up on as a minefield of some sort. One of the reasons behind this is that most people there have different views and ideas on what a contractor could be defined as. When you are an employed person typically and have been working on maybe a short term or a long term contract or are self employed, only then do you will fall under this category. Every lender has a policy of their own and of which the two could or won’t lend in the future. All of this depends on how long you have been contracting, the months you have worked in the industry and if you have had any contracts renewed.
What are the things you should consider?
First of all the age of the contract mortgages really matter. Most of the lenders will only give you contract mortgages to people have short or fixed contracts and are over the age of twenty five. Second, the structure of repayment: the lenders usually insist on repayment only mortgages for contracts on the basis of short term and fixed contracts.
Mortgages that have adverse credit
The lenders who offer contractor mortgages have already been exposed to much bigger risks and as a result of this, most will not accept such applications from those who have adverse credit. If you happen to be self employed with almost 12 months of history, then you will be eligible with credit of over 2 years.