Mortgage for IT contractor

ComputeAngel

Hi,

- I am an IT professional with having more than 10 years of experience in IT.
- I am working as a contractor (Directory of my own Limited company and 100% share holder) since start of December 2013 and will receive my first contractor invoice paid in mid Jan, 2014.
- From last four years I have worked as an employee with an average salary of about 40-45K p.a.
- I am on a six month contract and that will expire on June 2014.

I am looking to apply for a mortgage as a first time buyer.

Will I be eligible for mortgage? Can anybody please suggest some good mortgage brokers.


Thanks

ethank

I think any lender might require a more significant length of time than 1 month contracting before they agree to issue a mortgage.

ComputeAngel

ethank wrote: »

I think any lender might require a more significant length of time than 1 month contracting before they agree to issue a mortgage.

But can the transactions in last 3/4 years as a perm. employee can't be used?

ACG

As a percentage how big is your deposit?
Are you looking to do this asap or would you be able to hang fire until your contract is renewed?

notanewuser

You could have no work for 6/12/60 months from February.

Your timing is all off to get a mortgage.

ComputeAngel

notanewuser wrote: »

You could have no work for 6/12/60 months from February.

Your timing is all off to get a mortgage.

Sorry, I don't understand your point.

ACG wrote: »

As a percentage how big is your deposit?
Are you looking to do this asap or would you be able to hang fire until your contract is renewed?

I should be able to pay 30-40%. Ideally, I would like to do it ASAP. My current contract is valid till June 2014.

notanewuser

As an employee it would have been far easier to get a mortgage. Company directors are expected to have 3 years accounts to prove their reliable income. You've just jumped into consultancy, with a 6 month contract ad no guarantees beyond that. If you were a bank would you lend thousands of pounds on that basis?

ACG

With a 30-40% deposit i would imagine you can do this but i dont think many high street lenders will look at it. I think you need to get in touch with a decent whole of market broker for this.

ComputeAngel

notanewuser wrote: »

As an employee it would have been far easier to get a mortgage. Company directors are expected to have 3 years accounts to prove their reliable income. You've just jumped into consultancy, with a 6 month contract ad no guarantees beyond that. If you were a bank would you lend thousands of pounds on that basis?

I understand and this is what I am facing. However I also think that there is no guarantees for perm. employees either but the risk is lower.

ACG wrote: »

With a 30-40% deposit i would imagine you can do this but i dont think many high street lenders will look at it. I think you need to get in touch with a decent whole of market broker for this.

Will you be able to suggest any "whole of market" broker please?

Lomcevak

I'm a permanent employee in an IT department that's almost completely contractor-based, and mortgages for my contracting colleagues seem to be straightforward if they have accounts covering a couple of full years contracting and a track record of contract renewals and/or quickly finding new contracts.

If you don't have that track record then i'd imagine you would stand out as a substantial risk; as ACG says, with a decent deposit you should be able to find something, but IMO you would be better waiting if you can as it will probably start to become easier in 12 months or so

I understand and this is what I am facing. However I also think that there is no guarantees for perm. employees either but the risk is lower.

There are no guarantees, but income is much more dependable - a month or two with nothing coming in is pretty much expected for a contractor; all my (sensible!) contracting colleagues budget for it. A few live a here and now life where it is great while they are earning, but the first unplanned tax bill or contract gap usually trips them up

ACG

ComputeAngel wrote: »

Will you be able to suggest any "whole of market" broker please?

Unfortunately im not allowed to on the forums (part of the forum rules).

Have you tried google, asking friends/family or work colleagues who may be in a similar situation?