Getting a Contractor Mortgage
It can be very difficult for Umbrella Company contractors in getting a contractor mortgage if they just walk into their local high street lender.
The staff there are not used to dealing with Umbrella Company contractors.
When you say you are a freelancer they will ask you for three years accounts – which an Umbrella Company contractor doesn‘t have.
They will assume that you are a limited company contractor. So, if you can‘t produce the accounts then they may refuse you a contractor mortgage.
Specialist Contractor Mortgage Broker
Umbrella Company contractors are turned down in their thousands every year for contractor mortgages.
What they need to do is to go to a specialist contractor mortgage broker.
They can provide contractor mortgages which are based on a multiple of your contractor rate annualised rather than having to rely on any accounts or to payslips or even a reference provided by the Umbrella Company.
The amount of mortgage you get is based on your contract rate without any deductions for expenses, umbrella company fees or pension contributions.
Superior Contractor Mortgages
This means that Umbrella Company contractors can get much superior contractor mortgages than their permanent colleagues.
It used to be that contractors had to wait a few years to get three years of accounts and then deductions would not be taken into account and so they ended up with mortgages no better than their permanent colleagues and sometimes even worse.
The interest rate that Umbrella Company contractors get is no worse than that as a permanent staff member.
With the advent of companies dealing with specialist mortgages for contractors the high street banks have changed their opinions and are much more likely to lend.
These companies have developed a good reputation and now the big lenders feel more confident in loaning money for a mortgage to both Limited Company and Umbrella Company contractors
To find out more about getting a Contractor mortgage or to see how much you could borrow based on your contract rate, fill in a Contact Form here
Ad – Contractor Services
If you do need an umbrella company you could try one of the following:-
Public Sector Umbrella Company
Or would you prefer to get expert advice about which umbrella company is right for your specific needs? If so fill in the form below and they will be in touch.
For Mortgages specially designed for contractors try Specialist Contractor Mortgages.