Self Employed Contractor - Is It Easy To Get Mortgage?

2

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  • mystic_bertie
    mystic_bertie Posts: 592 Forumite
    First Post First Anniversary Combo Breaker
    I totally agree with you however is it worth taking this any further given that i have one default?
  • Jenniefour
    Jenniefour Posts: 1,393 Forumite
    First Anniversary First Post Combo Breaker Mortgage-free Glee!
    All the more reason to engage a good broker - either they will be able to sort out a mortgage or they can advise on what you need to do to make an application later.
  • LHZ
    LHZ Posts: 54 Forumite
    First Anniversary First Post
    Hey OP. Do you have an accountant who you are happy with? If so, ask him or her to recommend a Mortgage Advisor. I'm self employed and am currently looking to buy my second property as a buy to let. My accountant recommend a local mortgage advisor and he is excellent plus he can talk directly to my accountant to get the low down on my finances.

    By the way, my understanding is that most lenders will take an average of the last two years accounts, less any finance liabilities, to decide how much they will lend you.
  • mystic_bertie
    mystic_bertie Posts: 592 Forumite
    First Post First Anniversary Combo Breaker
    Many thanks for the replies folks. I have been in touch with a broker who seems to come highly recommended on another website which is non financial based. I have filled out all my details and he said he will apply and see if it gets approved due to my default. He did also state that because its 41/2 years old then it might not matter too much but we need to apply first and see.

    His fee is £295.
  • mostlynice
    mostlynice Posts: 21 Forumite
    First Post First Anniversary
    Santander and Halifax happily offer to contractors. All info on their websites. I have a default due to my now ex taking out payday loans in my name without me knowing about it.

    Applied with Santander - sent all requested paperwork including accountants certificate (they don't accept SA032's)

    Took 3 days in total to get accepted
  • mystic_bertie
    mystic_bertie Posts: 592 Forumite
    First Post First Anniversary Combo Breaker
    mostlynice wrote: »
    Santander and Halifax happily offer to contractors. All info on their websites. I have a default due to my now ex taking out payday loans in my name without me knowing about it.

    Applied with Santander - sent all requested paperwork including accountants certificate (they don't accept SA032's)

    Took 3 days in total to get accepted

    It is good to hear you got accepted and especially with a default. Im not sure if the info was up to date but i read the halifax like you to have been in the same contract for 2 years. I have only 15 months in my current role.

    I would apply directly but im worried mortgage applications might harm my credit rating.
  • mostlynice
    mostlynice Posts: 21 Forumite
    First Post First Anniversary
    I would definitely stick with a broker. They know which lenders allow soft search mortgage applications, and those who don't so there is less of a chance of messing up your file further.
    (Halifax for example allow soft searches - whilst at his stage, it may state you only require 10% deposit, when you hard search this can increase).

    Halifax state they require you to have been in a contract for 2 years, however, if you can prove you were in a similar contract previous to this one, you will be fine.

    Santander on the other hand are totally different. They require an accountants certificate. No proof of current contracts. They only require turnover.

    You can also ask for a letter off your main contractor/agent stating how long the contract is going to last. This all helps. It is worth noting, that whilst my default was declared at application stage (And some on this board consider it being the devil with it being a Payday Loan default), it was never questioned once. My application took the same amount of time as somebody with a clean history, according to my broker. There is hope for everybody
  • VentureMM
    VentureMM Posts: 10 Forumite
    I don't think you'll have difficulty being accepted based on your job. Many lenders consider self-employed contractors in your situation. Halifax are very good with contractors and would consider someone in your position. The evidence you'd be required to provide would depend on whether or not your employers pay your tax or if you do it yourself. If your employer does then you would only need to provide your latest payslip. If you do it yourself, you would be required to provide a minimum of 1 year's accounts.

    With regards to the default, lenders will look at anything within the past 6 years as this is the length of time it stays on your credit score. So if you say that it occurred in February 2011 then this should not be an issue. Again, Halifax are very good for this as they are less rigid with their lending criteria and more willing to take in to account any reasonable explanation you may provide.
    ___________________________

    I am a Mortgage Adviser
    You should note that this site doesn't check my status as a mortgage adviser, so you need to take my word for it. This signature is here as I follow MSE's Mortgage Adviser Code of Conduct. Any posts on here are for information and discussion purposes only and shouldn't be seen as financial advice.
    I am a Mortgage Adviser
    You should note that this site doesn't check my status as a mortgage adviser, so you need to take my word for it. This signature is here as I follow MSE's Mortgage Adviser Code of Conduct. Any posts on here are for information and discussion purposes only and shouldn't be seen as financial advice.
  • mystic_bertie
    mystic_bertie Posts: 592 Forumite
    First Post First Anniversary Combo Breaker
    Thanks for the replies guys. Its all good info and its keeping me feeling more positive about my application.

    I have instructed the broker to go ahead with the applications and so hopeflly i will et some kingd of feednback very soon. I just hope its good news and then i can go house hunting.

    Im used to buying and selling in Scotland. Im in England now. Does a fixed price mean that is the price you pay or can i still offer less? Does offers over mean i need to offer more on the asking price, is offering less likely to be rejected?
  • VentureMM
    VentureMM Posts: 10 Forumite
    There's no harm in making an offer, the seller can only say no; and while they may initially turn you down, you may find that they might come back to you if they can't find a buyer for the price they want.

    Also, you broker shouldnt really be looking to get you a decision in principle unless you know your going to make an offer on a property relatively soon, as these only have a fairly short life span of a few month and each time you obtain one it marks your credit score. If your already concerned about your credit score, you don't want to be doing anything that could affect it further; IMO.

    Either way best of luck with the house searching.
    I am a Mortgage Adviser
    You should note that this site doesn't check my status as a mortgage adviser, so you need to take my word for it. This signature is here as I follow MSE's Mortgage Adviser Code of Conduct. Any posts on here are for information and discussion purposes only and shouldn't be seen as financial advice.
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