Contractors and mortgages

skintlass

Hi,
My friend is a contractor and currently has 2 months of her original 4 month contract remaining and its just been extended by another 4 months. She says she gets a payslip and paid holidays (but no pension etc) which I think is unusual for a contractor (not one myself). We were discussing mortgages recently and she says that she doesn't have to tell mortgage providers that she is a contractor as she is "on the payroll". I was confused by this as even as a permanent employee who is admittedly in my probation period at a new company I know that I am not eligible for certain mortgages because I am in my probation period and would have thought that she would have to say that she is contract and not permanent. She is of the opinion that she just has to say nothing and submit her last 3 payslips and she will be fine - is that correct?

ManAtHome

Everythings fine until it stops working...

There are various shades of Temp/Contractor - you can either run (and be an employee of) your own company, operate as self-employed, or as a fixed-term employee of an agency (which I suspect your friend is).

Whichever one it is, you don't have any employee rights as such which could invalidate any mortgage protection insurance, but other than that no big deal. Even if you're formally employed, no guarantee that you won't be sacked or made redundant.

skintlass

Hi, Thanks for your answer. My friend used to have her own company but she's closed that now and I'm not sure how she's working. If thats the case though why do mortgage providers act reluctant to offer mortgage deals when you are in your probation period at work?

ManAtHome

Dunno - they used to be a bit reluctant unless you had 3 years trading records (many years ago) - suppose it depends on what you don't tell them...