Contractors Renting Property Wasting Money

Contractors Renting Property

Contractors Renting Property

If you are one of those contractors renting property then you may be tossing good money down the train.

You would be far better off buying your own property.

The number of people renting in the age range of 25 to 34 is now 35%. That’s up from 29% previously.

That’s a lot of money going to landlords, therefore, that doesn’t need to.

Contractors of 40 years of age and more who try to get a mortgage to buy a house may find themselves still paying for it in their retirement.

Getting a Mortgage

Many contractors believe that they cannot get a mortgage because:-

  • Building Societies and banks have told them that they need to be able to show three years worth of accounts
  • They will be offered a multiple of their Director’s salary rather than using their daily rate
  • Banks and building societies are asking contractors for large deposits
  • They will have to pay higher interest rates because their profession is more risky.

Nothing can be further from the truth.

Banks and Building Societies

It did use to be the truth and it still is in many banks and building societies.

However, there are now specialist contractor mortgage brokers operating getting a number lenders to loan to contractors.

Lenders were sceptical at first but saw that contractors were good customers. They made their payments and, largely, didn’t default on their mortgages.

Mortgage Offers to Contractors

So now contractors can get:-

  • A mortgage offer based on their daily rate annualised
  • Only their contract needed as proof instead of accounts
  • Mortgages with small deposits, often just 5% deposits
  • Interest rates often better than the market rates.

Contractor Mortgage Quotes

Moreover, they can get quotes in the same day as they apply and can usually move into their dream house in a month or under.

According to Shelter, those renting will pay, on average, £41,000 in rent over the next 5 years. That’s 41% of the value of a first time buyers home.

In London it is even worse. Those renting there will pay a whopping £89,000 in rent over the next 5 years. That’s 23% of the value of the average first home.

So, if they took out a mortgage it would only cost them £66,000 in mortgage repayments over the next 5 years. That’s with a 95% mortgage with a 5 year fixed rate.

So, renters will lose out to the tune of £23,000 over 5 years – and they won’t have anything to show for it at the end.

There is no minimum number of years you have to be a contractor before you get a mortgage.

Specialist Mortgage Brokers for Contractors

Specialist mortgage brokers can get first time contractors mortgage quotes on the very first day of their first ever contract.

If a contractor earns £400 a day their mortgage offer would be not too far off £500,000. That’s even if they have just started contracting.

Contractors renting property must be mad.

If you want to find out more and see how much you could get just fill in the form below and someone will be in touch.

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Brexit Contractor Mortgages Market Bonanza

Brexit Contractor Mortgages

Brexit Contractor Mortgages

It looks like there is going to be a post Brexit Contractor Mortgages boom which is good news for contractors.

Firstly, the Governor of the Bank of England, Mark Carney, went on TV to announce that interest rates are likely to fall in the summer.

Therefore, this will not only make mortgage cheaper, it will boost house prices across the country.

Rising House Prices

Secondly, the pound has fallen by around 10% against the Euro since the referendum.

This will make it 10% cheaper for people from outside the country to buy houses in the UK.

Furthermore, the fall is even more pronounced against the dollar which will make it cheaper still for Americans to buy in the UK.

Best Deals

Best Deals for contractors seeking mortgages

This will affect mainly London and the bigger cities but there will be a knock-on effect elsewhere. It should push house prices higher still.

Better Remortgage Rates Also

So, it seems that Brexit has been good for getting great rates on remortgages.

Indeed, just this week, HSBC have come out with a two-year fixed rate mortgage of just 0.99%.

Santander has come up with a 10-year fixed mortgage rate of just 2.94%.

This goes along with their 5-year fixed rate mortgage ast 2.24%.

It is predicted that there are going to be lots of great 5-year fixed rate mortgages being offered in te next few weeks.

Higher Property Prices

These deals are sure to send property prices north as mortgages become more affordable.

Prior to Brexit the pundits were predicting the end of cheap mortgages as they expected interest rates to start rising soon.

They said that the recovery in the economy would send interest rates rising. That would, therefore, mean mortgage rate increases.

House prices were expected to fall because of it.

Brexit Contractor Mortgages Boost

However, Brexit has changed all of that.

With the Brexit contractor mortgage market expected to bring lower mortgage rates, houses are likely to start moving higher.

Contractor Property Market

Contractor Property Market Opportunities

For contractors it is always better to contact a specialist contractor mortgages broker rather than step into a high street bank or building society.

Those specialist brokers can get the right mortgage for you.

They can also get it based on just your contract rather than having to see three years worth of accounts. Also, they will base the offer on your daily rate annualised rather than on your Director’s salary.

So, it’s a good time to take advantage of the Brexit Contractor Mortgages boost.

For more information you should fill in the box below and you’ll be sent details.

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Specialist Contractor Mortgage

Specialist Contractor Mortgage using a broker

Specialist Contractor Mortgage

You should always get a specialist contractor mortgage rather than walking into a high street branch.

Many contractors make the mistake, when looking for a mortgage, of walking into their local High Street bank or building society and asking for a mortgage there.

What happens is that the lender is not used to dealing with contractors and has no specialist contractor mortgages. They then tell the contractor that they need to produce three years worth of accounts. Usually you must be a contractor for at least 4 years to have those.

If the contractor can’t provide those then that is a deal breaker. The contractor goes away believing that he, or she, has to wait a few years before applying for a mortgage.

Based on Director’s Salary

Even if the contractor has more than four years’ experience and can produce the accounts, the next obstacle that they face is that the high street bank or building society only count the amount that the contractor is paid as a director. They then multiply that annual salary by 3 or 4 to work out how much they should loan the contractors.

As we all know, contractors like to pay themselves as little as possible so that they can take more of their money in dividends.

What the contractor should have done is to contact a specialist contractor mortgages broker.

Daily Rate Annualised

They have a good reputation with those who loan money. So, they can get contractors a mortgage without having three years of accounts. This is very useful. That’s because one of the times when contractors want to buy a house is when they first start contracting and have more spare money.

The second way that the specialist contractor mortgages broker can help is that they can get contractors mortgages based on their overall income. It is based on their whole daily rate translated to an annual amount.

The multiple is on that sum and not on their director’s salary. This makes a huge difference on the mortgage offer.

So, it’s always wise to get a specialist contractor mortgage.

Here’s one of those Specialist Contractor Mortgages

Contractor Mortgage Offer – how much can you get?

How Much Can You Get

So, How Much Can You Get

The questions contractors ask is how much can they get when applying for a specialist contractor mortgage.

Tony Harris is a specialist contractor mortgages broker. He has successfully got contractors mortgage offers for years, way above what a high street bank would get you. We ask him how much a contractor can get on his contractor mortgage offer and how it is worked out.

Tony, how much of a contractor mortgage offer can you get a contractor? Is it related to the amount you pay yourself from your company? Can you get a contractor mortgage offer based on the total amount of the contract? Say I was earning £400 a day but paying myself £150 a day? How much of a contractor mortgage offer could you get me?

Tony’s reply on Contractor Mortgage Offer

“Our specially negotiated contract based underwriting uses your hourly or daily rate to work out how much you can borrow This is irrespective of how much you physically draw out for yourself.

“We simply take your daily rate of £400 and work out what your annualised rate would be if you worked at this level for five days a week and 48 weeks of the year.

“The lender will then specify what multiple of this they are willing to lend. However, it is usually around four times annual contract rate.

Contractor Mortgage Offer from Contract

“This means you could secure a mortgage of £384,000 despite only paying yourself £150 a day.

“You don’t have to have an annual contract to receive this amount. The lenders we use understand our niche clients. They appreciate that you are highly likely to secure another contract as soon as the current one has ended. So even if you only have a three-month contract, we should be able to secure you a mortgage”.

Director’s Salary

That’s pretty good and a lot more than a bank or building society would offer you. They would only take the Director’s salary you draw. They offer contractor mortgages based on 3, 4 or 5 times that. That wouldn’t buy you much.

It’s basically all down to Tony’s credibility with the mortgage brokers and his success down the years in bringing them contractors who pay their mortgages. Contractors can tap into that.

To get further information or to apply for a mortgage, fill in a form here and Tony will get back to you:- Contractor Mortgages

Contract Nurses Can Now Get Great Mortgage Offers

Contract Nurses Great Mortgage Offers

Contract Nurses

Contract Nurses can now take advantage of specialist mortgages from specialist contractor mortgage brokers.

These brokers can get them the best mortgages offers at the best market rates.

These specialist mortgage brokers came into the market around 10 years ago.

They were mainly, first of all, for IT Contractors. Previously mortgage lenders had considered contractors too risky to lend to.

Monthly Mortgage Payments

Therefore, they had to produce three years worth of accounts and only got mortgage offers based on their director’s salary, which contractors usually kept low to take their money in dividends.

Furthermore, the new contractor mortgage brokers were able to get contractors mortgage offers based on their daily rate annualised – without having to produce accounts. All they had to show was their contract.

These IT contractors made their monthly mortgage payments and had a low level of default.

So, a few years ago, these mortgage lenders decided that they would offer specialist contractor mortgages to all contractors including nurses.

Now, specialist lenders have expanded the market and nurses are able to take advantage of that.

So, contract nurses can now get mortgages as easily as any other contractors.

To apply just click on Contractor Mortgage Application

If you fill in the form, someone will be in touch to explain it more.

 

Best Deals Around for Contractor Mortgages

Best Deals

Best Deals

Specialist Contractor Mortgage Brokers offer the best deals for contractors.

Indeed, those specialist brokers have multiple lenders in tow that they can approach on behalf of the contractor in order to get the best deals available for them.

Gone are the days, however, when contractors were told by banks and building societies that they must produce three years worth of accounts and would get mortgage offers based on their director’s salary rather than their daily rate.

Contractor Mortgage Quote

Contractor Mortgage Quote at best rates

So, that would come as a shock to contractors who expected the red carpet to be let out for them on the back of the huge amounts of money they were now earning.

I say ‘gone are the days’ but if a contractor walked into a bank or building society on the high street, even now, that is exactly what they would be told.

So, that is why contractors use specialist broker who specialise in getting contractors mortgages with the best deals possible.

Best Deals Available for Contractors

So, what are the best deals available, at the moment, through these specialist brokers?

There are 3 that catch the eye.

Firstly there is a 2-Year Tracker Mortgage where the Loan to Value is 60%, i.e. you need a deposit of 40%.

That’s at a rate of just 0.79% plus base rate (currently 0.5%). That ends at the end of March in 2018.

Secondly, there is the 2-year fixed loan at 1.8% where a deposit of 25% is needed. Again that runs out at the end of March 2018.

Finally there is the 2-year fixed loan at 1.89% plus base rate (currently 0.5%). That runs for two years and the deposit needed is only 10% of the loan value.

Cheap Mortgages for Contractors

So, mortgages have never been so cheap – especially for contractors.

IT Contractor Mortgages interest rates

IT Contractor Mortgages offers

First of all, mortgage lenders used to charge them a premium before the advent of specialist mortgage brokers.

Now those specialist brokers can get contractors mortgage offers based on their daily rate annualised – with only their contract as proof of earnings.

What’s more they can get mortgage offers on the same day as they apply because of these brokers.

Indeed, first time contractors can get a mortgage offer on their very first day on their very first contract.

Therefore, to get further info just fill in the form here and a specialist broker will be in touch.

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Contractor Mortgages Lender Allows for Breaks Between Contracts

Contractor Mortgages Lender

Contractor Mortgages Lender

In a new breakthrough, a brand new lender has turned the contractor mortgages market upside down.

It used to be that it was very difficult to get a mortgage if you were a contractor.

Many contractors, with their new contract rates, double what the earned as permies, expected to be welcomed with open arms by high street banks and building societies.

However, they were seen as risks by them. Contractors had to produced three years of accounts which scuppered new contractors for several years.

Specialist Contractor Mortgages

Specialist Contractor Mortgages brokers

I know. It happened to me when I first started contracting. I was shocked.

Offer based on Director’s Salary

What’s more they only offered you mortgages based on a multiple of contractors’ director’s salary.

As we all know contractors like to keep this as low as possible. They don’t want to hit the upper rate of tax and so take much of their money in dividend payments.

You would have been better off applying for a mortgage as a permie before you went contracting.

Contractor Mortgage Brokers

However, in the past decade specialist contractor mortgage brokers have sprung up.

They have convinced mortgage lenders to loan to contractors.

Contractors could now get mortgage offers based on their daily rates instead of director’s salary

They could also get mortgage approval with just their contract as proof rather than having to produce three years worth of accounts.

Many contractors are taking advantage of these offers obtained through these specialist mortgage brokers.

Contractor Mortgages UK

Contractor Mortgages UK based on daily rate annualised

This was much better for contractors – although the lenders were still a little conservative.

Bluestone Mortgages

Now, a new lender, Bluestone Mortgages, backed by the private equity arm of Lloyd’s Bank, have come up with a mortgage much suited to contractors.

This new flexible contractor mortgage would suit those contractors who like to take time off between contracts.

Even more importantly, it will suit those forced to take time off between contractors.

Many a sleepless night has been spent by contractors who have all their bills to pay whilst not knowing when they will get their next contract.

Breaks in Contract Work

Bluestone Mortgages are showing a great understanding of the contracting profession.

Previously contractors would find it difficult to get a mortgage if they had any break in contract work in the past year.

Now Bluestone Mortgages will allow up to a 6 month break in the past year.

They will also take a flexible view of any missed payments that are on a contractor’s credit file.

Knowing how contracting works they are even accepting the odd serious credit transgression showing on the contractor’s credit file.

Best Mortgage Deals for UK Contractors

Best Mortgage Deals that UK contractors can get

Major Breakthrough

This is great news for contractors and a major breakthrough in the specialist contractor mortgage market.

This new contractor mortgages lender is the perfect fit for contractors of any mortgage lender so far.

To find out more from the specialist contractor mortgages broker who negotiated this deal with Bluestone Mortgages simply fill in the form below and someone will be in touch.

Please click on Contractor Mortgage Application and fill in the form there.

Favourite Contractor Mortgages Brokers

Favourite Contractor Motgages Brokers

Favourite Contractor Mortgages

My favourite contractor mortgages brokers are those that are specialists in the contractor market.

These guys didn’t exist till ten years ago.

Contractors always found it difficult to get mortgages.

When they went in to see high street banks and building societies, with their new-found wealth, they expected to be welcomed with open arms.

Favourite Contractor Motgages Brokers

Favourite Contractor Mortgages Brokers for deluxe mortgages

Favourite Contractor Mortgages

Favourite Contractor Mortgages from specialist contractor mortgage brokers

Instead, it was just the opposite.

Contractors Too Risky To Loan Money to

The banks and building society managers saw them as a big risk. They didn’t have steady income like a permanent employee.

They saw them as so risky that they wanted to see a track record.

They wanted to see three years worth of accounts.

That meant that you had to have been a contractor for well over three years to have those.

Contractor Mortgage Offer Blow

Then, if they managed to pass that obstacle, they were hit with a blow to the solar plexus.

The mortgage offer they got was just a multiple of their Director’s salary.

Favourite Contractor Mortgages

Favourite Contractor Mortgages from specialist contractor mortgage brokers

Most personal service company contractors keep that deliberately low. They want to take their income in dividends, which are taxed at a lower level.

This is what happened to me when I first wanted to buy a house. I was  sent packing and told to come back in a few years.

Even now, if you walk into a high street bank, or building society, this is the response you will get.

Specialist Contractor Mortgage Brokers

Luckily, with the advent of specialist contractor mortgage brokers, contractors can now get proper mortgage offers.

Contractors can get the best mortgage offers and the best interest rates through them.

There was a huge gap in the market with the growth of the contracting market in the UK.

Contractors were on the outside looking into the deluxe mortgage market.

Those that took on mortgages when they were permanent employees were the lucky ones.

Specialist Mortgages for IT Contractors

However, ten years ago, one mortgage broker convinced one mortgage lender to take a chance and loan money for mortgages to a few IT Contractors.

That worked, so they loaned more IT Contractors money for mortgages.

Instead of being a risk, these IT Contractors paid up their monthly mortgage instalments regularly and had a lower rate of default than on the general market.

Contractor Mortgage Quote

Contractor Mortgage Quote at best rates

As a result, this specialist deluxe contractor mortgage broker got more and more credibility with more and more lenders. They were falling over themselves, then, to loan to contractors.

Mortgages for All Contractors

A couple fo years ago, the mortgage lenders expanded the market to all contractors.

Now, there are more and more great deluxe mortgage offers for contractors from more and more lenders through these specialist contractor mortgage brokers.

As I said, the favourite contractor mortgages are got by those mortgage brokers specialising in getting contractors mortgages.

They can get contractors lower interest rates and higher mortgage offers than contractors could get on the general mortgage market.

The Best Contractor Mortgages

The great news is twofold.

Firstly, contractors can get mortgage offers based on their daily rate annualised rather than using their Director’s salary.

The mortgage lenders take contractors’ weekly rate and multiply that by 48 for a contractor’s annual salary.

They then multiply that by 4 (or even 5 sometimes) to get the mortgage offer they make.

Using Your Contract as Proof of Income

The second great piece of news is that the best mortgage lenders don’t need to see three years worth of accounts before making a mortgage offer to contractors.

Mortgage Brokers for Contractors

Specialist Mortgage Brokers for Contractors in the UK

They just need to see a contractor’s contract ss proof of income.

Indeed they can get a first time contractor a deluxe mortgage offer on the very first day of his, or her, first ever contract.

The favourite contractor mortgages brokers in the contracting market are those that can get the best offers for contractors.

To find out more, or to apply for one of these top class mortgages from the specialist brokers, just click Favourite Contractor Mortgages Application and fill in the form.

95% Mortgages for Contractors with just 6 Months Contracting

6 months contracting experience

6 Months Contracting

There’s a new lender in the contractor mortgage market – and they’re lending to contractors with as little as 6 months contracting experience. Their name is Buckingham Building Society.

To get a 95% mortgage contractors usually have to have two years experience, at least, as a contractor.

They also have to have a minimum income of £300 a day because of the extra perceived risk that lenders see with contractors.

Best Contractor Mortgages

Best Contractor Mortgages Rates & Offers

Buckingham Building Society and Contractor Mortgages

However, the Buckingham Building society has cut through that. It is offering its mortgages to new contractors with just 6 months experience as a contractor.

Also, there’s no minimum daily rate needed. They will consider all contractors regardless of their contract rate.

Their mortgage offer will be based on the contractors’ daily rate annualised, i.e. their weekly rate multiplied by 48 to get their annual salary and then multiplied by up to 5 again to get the mortgage offer.

There’s no need for contractors to have to provide accounts. All the proof needed is the contractor’s contract.

Specialist Contractor Mortgages

Specialist Contractor Mortgages brokers

Specialist Contractor Mortgage Market

More and more lenders are getting into the specialist contractor mortgage market.

They all used to think it was too risky.

One building society was convinced by a contractor mortgage broker to dip their toes in the water to see if contractors were a good risk.

It all worked out well. The contractors kept up their payments even when out of work and they did not default on their mortgages.

This gave the specialist contractor mortgages broker a lot of credibility and so more and more banks and building societies started to loan to contractors.

The Buckingham Building Society is just the latest.

Contract Based Mortgage Offers

Contract Based Mortgage Offers from Specialist Brokers

Better Mortgage Offers for Contractors

Indeed it looks as if more and more banks and building societies want to hitch a ride on this gravy train.

As contractors give the contractor mortgage brokers more and more credibility, by keeping up their payments, expect better and better mortgage offers for contractors.

Buckingham Building Society are making mortgage offers to contractors, now, who have just 6 months contracting behind them.

Expect there to be more and more offers like this as the banks and building societies see lending money to contractors as not very risky at all.

To take advantage of this offer from the Buckingham Building Society, or other contractor mortgage offers, contact a specialist contractor mortgage broker by clicking on Contractor Mortgage Application and fill in the form there.

Contractor Buy To Let Action Needed Now

Contractor Buy to Let investment

Contractor Buy To Let

The Chancellor hit Contractor Buy to Let properties in the Autumn Statement.

Contractors got off lightly in the Autumn Statement.

Chancellor Osborne didn’t carry out most of the threats he made, beforehand, or he at least watered them down.

However, contractors who have invested their money in property have not fared so well. The Chancellor is going to hit them next year.

Buy To Let Purchases

Buy to Let purchases went up by 36.4% in September compared to August.

That’s despite the withdrawal of interest mortgage relief by the Chancellor.

Costs will go up a lot from April next year which is when the levy gets rolled out.

Contractor Buy To Let

Contractor Buy To Let

Let to Buy Stamp Duty Rises

The cost of stamp duty for a Buy To Let of £250,000 will go up from £2,500 to £10,000.

That’s four times what it was before and a hefty increase.

So, how much of a problem is this for Buy To Let contractors?

Freelancers have traditionally invested in the stock market and property to try to use their contractor earned money to try to make more money.

This is unlikely to change.

Mortgage Interest Relief

However, smart contractors will be making their Buy To Let purchases ahead of next April when the change comes in.

This will save them thousands of pounds in stamp duty.

As regards Mortgage Interest Relief, here is how does the change will impact on contractors.

At the moment, contractors only pay tax on their rental income after deducting their monthly interest payments and some allowable expenses.

Tax will then paid on the profit at the contractor’s highest marginal rate of income tax.

So, it looks like UK contractors, who are heavy investors in property, will be stampeding to buy new properties, using Buy to Let before next April.

The sooner they start the better as everyone know how long it can be from staring a property search to actually completing a deal.

There won’t be a better time for Contractor Buy to Let opportunities.

Contractors Buying Property

Contractors Buying Property for investment

Specialist Contractor Mortgage Brokers

Contractors are much better using specialist contractor mortgage brokers when buying a property. They can get contractors better rates.

They can get them offers using their daily rate annualised rather than their Director’s salary which a hight street bank or building society would do.

Offers are all on production of your contract instead of the three years worth of accounts that the banks and building societies would ask for.

To find out more info from the specialist contractor mortgage  broker, or to apply, just click on Contractor Mortgage Application and fill in the form there.