For the first time in a long time, it looks like freelancers, umbrella company contractors, and other self-employed Brits will be getting mortgage help.
If you’re self-employed and you’ve ever tried to get yourself a home loan, you’re likely familiar with the oh-so wonderful sensation of having bank staff laugh in your face just before unceremoniously ushering you outside and slamming the door behind you. All right, maybe that was just my experience, but it’s still not exactly easy to get a mortgage as a freelancer or a contract worker – banks would rather you have steady pay coming in from an employer than have to rely on finding clients on your own.
However, there seems to be a sea change in the realm of financial services – an increasing number banks like Halifax, and even some specialised lenders like Principality and Kensington are allowing self-employed Brits a chance at qualifying for a mortgage with just proof of one year’s worth of accounts.
This is a big difference from the prevailing market method, which has banks requesting a minimum of three years of proof that you’ve been working steadily as a freelancer. In other words, you needed two years of contracts under your belt, plus an active contract with a minimum of six months still running on it. This has caused plenty of trouble for contractors – research has shown that almost out of every four self-employed individuals couldn’t qualify for a mortgage from several lenders before finally securing one, while one out of ten were turned down everywhere no matter where they went.
Of course, now the times are changing. There are more Brits working for themselves than ever before – something like 4 million at last count – and the financial markets are realising that they’ve been turning away a massive amount of prospective customers. If you ask me, this is a fantastic, brilliant development, and one that’s time has come.
Working for yourself without the safety net of a steady job with an employer is rapidly becoming an accepted way to earn a living in the UK, and it’s gratifying to see it finally earn respect and recognition. With sole traders, small business owners, and contract workers contributing so much to the British economy, it’s about damned time that their hard work was recognised – isn’t it right that these hard-working Brits finally get the attention they so richly deserve?
For help and assistance getting a contractor-specific mortgage, give the guys at contractormortgages.co.uk a buzz today.