Q. Can I get a mortgage agreed in principle before I buy?
A. Yes, in many cases we can secure you an agreement, based purely on your contract rate alone (ie no question that the lender will backtrack once they see your accounts), within minutes. Armed with this information you will then be an even stronger position to negotiate and we will happily verify with the seller/estate agent that you are ‘good for the money’
Q. Will I have to pay higher interest rates because I am a contractor?
A. Not at all. Whereas in the past those working on short-term contracts would have often been looked on as ‘non-status’ borrowers and would have paid high deposits and uncompetitive interest rates with niche mortgage lenders, we have spent many years of patient negotiation to secure you the same low rates enjoyed by permies. Choose from discounts, fixed rates or the new generation of cheque book ‘Offset’ mortgages. Self-Certification mortgages (where no proof of income is required) can sometimes feature higher interest rates but Contractormoney can now even these mortgages with the likes of Woolwich and Northern Rock so that you need pay no premium to follow this route either.
Q. Do I need a deposit?
A. 10% deposit will secure you options with a very wide range of lenders although 5% deposits are perfectly acceptable. We have access to a 100% mortgage and can even secure a loan that is up to 125% of the purchase price (allowing you to budget for stamp duty etc or pay for renovation work).
Q. How long do I need to have been contracting?
A. We have the ability to arrange a mortgage within a week of you starting your first contract
Q. How long do I need to have remaining on my contract? A. Unless we look at the self-certification route, most lenders will require 6 weeks left to run on your contract although we can often have room for negotiation on this and often we will be able to convince your agency to help ‘talk up’ your prospects of a renewal/fresh contract for mortgage purposes.
Q. How long does the mortgage process take?
A. Depending on which lender we eventually agree is best for your circumstances we can have approval of your loan within minutes. Once the survey has been done and the necessary legal searches performed by your solicitor the whole house buying process generally takes 3-4 weeks max
Q. What supporting documentation will I need to provide?
A. We would ordinarily just need a copy of your contract, CV, bank statements and ID.
Q. Will I need accounts?
A. Definitely not. Unlike less specialist advisers we fully understand that you may not have three years woth of accounts. Far better to simply work from your contract rate alone.
Q. What costs will I need to find?
A. As we charge no brokers fee to PCG members the only costs will be valuation and legal fees and sometimes an arrangement fee to book a particular interest rate. Often we can secure schemes where the lender will pay some or all of these fees for you as an incentive.
Q. What about stamp duty?
A. One of the great stealth taxes, stamp duty kicks in at 1% of the purchase price above £60k At £250k the governments cut rises to 3% and above £500k to a massive 4%. There may be scope to negotiate with your vendor if you are buying at a price close to these thresholds.
Q. What is a mortgage indemnity and will I have to pay it?
A. Indemnity premiums are a hefty fee that many lenders will charge you if your unable to put down a large enough deposit. This protects them (not you) against your defaulting on the loan and leaving them a debt higher than the value of the house. Contractormoney will always attempt to avoid lenders that charge this costly fee.
Q Will I have to accept costly loyalty clauses to secure a mortgage?
A. We pride ourselves on always securing you competitive ‘High Street’ interest rates whilst avoiding schemes that feature stings in the tail. Too many contractors have been tempted by lenders offering a low headline grabbing rate only to find that they suffer long periods at higher rates with penalties that are charged if you attempt to break free. We can recommend a competitive selection of schemes that will allow you complete freedom to move your borrowing at any time or at the very least allow that freedom as soon as your current rate expires- allowing you to move onto the next good rate as soon as this one ends.
Q. What will happen to my mortgage rate after the initial scheme expires.
A. Too many people allow inertia to set in once an initially competitive interest rate expires. We will be in touch 2 months before the expiry of any special rate that you may be on so that we can explore the options available if you. We will look at what is on offer from the current lender and compare this with what is available elsewhere in the market. If appropriate we can often arrange a new lender to pay all fees to move your loan across to their schemes. In this way Contractormoney will be on hand to keep an eye on future market conditions and will help to ensure that you secure a competitive interest rates throughout the life of your mortgage
Q. Will I need to take out compulsory insurances with my mortgage?
A. We will always try and ensure that there are no hidden shocks when we make a mortgage recommendation to you. We will avoid schemes that insist on you taking out uncompetitive home insurance etc. We also avoid lenders that insist that you must take out life cover although as IFAs we would always recommend that your debt is properly protected and will be happy to provide no obligation advice on this subject.
Q. I want to move but cant/don’t want to sell my current home
A. 'Let to buy' is the ideal solution if your unable to sell your current house (maybe it needs updating to realise its full potential, perhaps its proving slow to sell at the right price or possibly you've lost a buyer but still want to complete your purchase). Contractormoney can arrange a buy to let loan on your current property to release the deposit on your new purchase
Q. I have an existing property. Can I release some of the profit made from my house?
A. We can arrange a fees free (ie the new lender pays all costs) re-mortgage to allow you to switch to a lower interest rate and release some of the equity in your home at the same time. In this way a larger loan may even cost you less than the existing one! Funds can be used for any purpose-debt consolidation, tax bill, business venture, a deposit on a buy to let property etc.
Q. I have had a CCJ. Will this stop me from getting a mortgage?
A. No. We have access to a range of ‘impaired credit’ schemes to get you back on track and allow you to buy a property/move up the property ladder.
Q. What next?
A. Simply complete the form
here and one of our qualified mortgage advisers will quickly be in back in touch by email with some recommendations to exactly fit your mortgage requirements.
Financial advice on these pages is being given by FreelancerMoney, which is a trading name of ContractorFinancials Ltd and is regulated and authorised by the Financial Services Authority.
Your home may be repossessed if you do not keep up repayments on your mortgage
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