.png){kind=logo}
Working on a contract does not prevent you from getting a mortgage, but the way your income is assessed can vary considerably between lenders.
Jayhawk Capital advises professional contractors, limited company contractors, umbrella workers and people paid through the Construction Industry Scheme.
We take the time to understand your current contract, working history, income structure and future plans, giving you an early and honest view of how your earnings may be assessed and which mortgage routes appear realistic.
Mortgage advice for day-rate professionals, limited company contractors, umbrella workers, fixed-term contractors and CIS workers.
There is no separate type of mortgage reserved for contractors. The main difference is how lenders calculate and evidence the income used for affordability.
One lender may assess a contractor using salary and dividends or completed accounts. Another may use the value of the current contract or recent payslips.
The most suitable route can depend on:
Understanding these details at the beginning helps identify which lenders are likely to assess your income in a way that reflects how you actually work.
Contractors can be paid and structured in several different ways. Lenders do not all assess those arrangements in the same way.
Some lenders can assess income using the value of your current contract rather than relying solely on completed accounts or the salary and dividends withdrawn from a company.
The lender may use your day rate and an assumed number of working days to estimate annual income. The precise calculation varies, and the lender will also consider the contract length, time remaining and your work history.
A contract-based assessment can be particularly relevant where your taxable income does not fully reflect the value of your work or where you leave profit within a limited company.
A contractor working through a personal service company may receive a salary, dividends or a combination of the two.
Some lenders will assess the application using those figures and the company accounts. Others may be willing to consider the current contract rate where the applicant meets their contractor criteria.
The appropriate approach will depend on the company structure, percentage ownership, contract, accounts and wider financial position.
A contractor working through an umbrella company is normally paid through PAYE by the umbrella company.
Lenders may assess the income using umbrella payslips, the current assignment or contract and evidence of the applicant’s recent working history.
The payslip can contain several figures, including basic pay, holiday pay and other taxable elements. It is therefore important to establish which parts of the income the lender will accept rather than relying on the total figure without checking the underlying calculation.
You may be directly employed on a fixed-term contract or paid through an employment agency rather than operating through your own company.
The lender may consider your salary, the length and remaining term of the contract, whether it has previously been renewed and your employment history within the same sector.
Some lenders can accept a fixed-term arrangement where there is a reasonable history of continuous work or evidence that the contract is likely to continue.
The Construction Industry Scheme applies where contractors deduct money from payments made to subcontractors and pass those deductions to HMRC as advance payments towards tax and National Insurance. CIS workers can operate as sole traders, through partnerships or through limited companies.
Some mortgage lenders assess CIS applicants using accounts or tax calculations in the same way as other self-employed borrowers. Other lenders can consider gross income shown on recent CIS payment and deduction statements.
This can produce a different assessment from using net profit after business expenses, so it is important to compare both routes rather than assuming that one method will always provide the most suitable outcome.
Jayhawk Capital can assist CIS workers across construction and skilled trades, including builders, electricians, plumbers, carpenters, roofers, scaffolders, decorators, plasterers and other specialist subcontractors.
A lender will usually want to understand both your current income and whether the work appears likely to continue.
The lender may also consider your experience in the occupation, how long you have worked in the sector and whether there have been significant gaps between contracts.
Providing the correct information at the beginning can help the lender understand the application without repeatedly requesting documents that do not reflect the way you are paid.
The information required will depend on your working arrangement, but it may include:
Not every contractor has several years of accounts or a long history of working through the same structure.
A recent move into contracting does not automatically prevent a mortgage application.
Some lenders can consider applicants who have moved from permanent employment into a contract role within the same industry, particularly where the current contract and previous professional history demonstrate continuity.
A gap between contracts may also be acceptable, depending on its length, frequency and explanation. The lender will want to understand whether the gap is part of a normal working pattern or indicates that the income has become less reliable.
Working inside or outside the off-payroll working rules can affect how your income is paid and evidenced. The lender will still need to understand the contract, payment structure, working history and overall affordability position.
We will review the current and previous arrangements before explaining which lenders appear suited to the position and whether any further evidence is likely to be needed.
You may have:
A contractor may earn a strong and consistent income without that position being clear from a conventional application.
This can happen where:
A limited company contractor may withdraw only part of the company’s income as salary and dividends.
Where suitable, a lender using the current contract rate may reach a different affordability result from one relying only on personal taxable income.
Contract rates can increase or decrease as you move between clients or projects.
The lender may consider the current rate alongside previous contracts and the overall working history rather than assuming that every year will look identical.
Some contractors combine a principal assignment with consultancy work, employment, rental income or earnings from another business.
Each income source will need to be evidenced and assessed under the relevant lender’s criteria.
Larger borrowing can require a more detailed understanding of the contract, company, assets and wider financial position.
The way the application is explained and supported can be particularly important where a standard affordability calculation does not reflect the complete circumstances.
Jayhawk Capital’s experience with professionals, business owners and clients with more complex income structures allows us to consider the full position rather than treating the contract status as a problem in itself.
Jayhawk Capital can help contractors across a range of residential mortgage requirements.
We can assess how your contract income may be treated, what budget appears realistic and which documents are likely to be needed before you make an offer.
Your current property, available equity, new purchase price and latest contract income will need to be considered together.
Where your employment or payment structure has changed since the existing mortgage was arranged, the lender will assess your current position.
A remortgage may be considered when an existing deal is ending, when you want to alter the mortgage term or where additional borrowing is required.
We can compare staying with your existing lender against moving to one whose contractor criteria may be better suited to your current income structure.
A larger purchase may involve a substantial day rate, several income sources, company funds or assets that are not fully reflected by a standard mortgage calculator.
We bring those elements together to provide the lender with a clearer view of the application.
We begin with the property, amount required, deposit or equity and what you want the mortgage to achieve.
We also establish how you are paid, the current contract terms and your recent working history.
We assess the contract income, supporting documents, expenditure and existing financial commitments.
Where something could restrict the available options or needs further explanation, we aim to identify it before approaching a lender.
We consider lenders whose approach to contractor income appears suited to your circumstances.
We explain the proposed mortgage, principal conditions and costs before preparing the application and relevant supporting documents.
We remain involved while the lender completes its affordability assessment, valuation and underwriting.
You will be kept informed about where the application stands, what is being reviewed, whether anything further is required and what happens next.
Jayhawk Capital was built around speed, accuracy and clear communication. That means understanding the contract properly, being frank about what appears achievable and presenting the application in a way the lender can assess clearly.
Yes. Contractors can obtain residential mortgages.
The lender will need to understand how you are paid, the value and length of your current contract, your work history and whether the income appears sustainable.
The available options will also depend on your deposit, expenditure, credit position and the property.
The calculation depends on the lender and your working arrangement.
Some lenders use salary, dividends, accounts or tax calculations. Others may assess income using your day rate, current contract, umbrella payslips or CIS payment statements.
We will compare the assessment methods that appear relevant to your circumstances.
Not always.
Contractors who can be assessed using a current contract or payslips may not need two full years of company accounts.
The lender may instead look at the length of the contract, time remaining, previous work history and continuity within the same industry.
Potentially.
Some lenders can consider applicants who have recently moved from permanent employment into contracting, particularly where they remain in the same profession and hold a suitable current contract.
The contract length, income, previous experience and wider strength of the application will all be relevant.
They can affect the assessment, but a gap does not automatically prevent an application.
The lender may consider how long the gap lasted, whether gaps occur regularly and whether you have since returned to stable contract work.
Yes. Some lenders can assess umbrella company workers using recent payslips together with the current contract or assignment.
The way umbrella payslips are structured can vary, so the lender will need to establish which elements of pay can be included.
Yes. Some lenders assess CIS workers using accounts or tax calculations, while others can consider recent CIS payment and deduction statements.
The most suitable route will depend on your work history, income, deposit and wider circumstances.
Not necessarily.
The deposit required will depend on the mortgage product, property, affordability, credit history and overall application rather than contract work alone.
Providing a larger deposit may widen the range of products available, but contractor status does not automatically create a separate deposit requirement.
No single IR35 status determines whether a mortgage is available.
Working inside or outside the off-payroll rules can change how your income is paid and which documents are available. The lender will assess the actual payment structure, contract history and affordability.
Yes. A contractor can apply jointly with an employed, self-employed or contract-working applicant.
The lender will assess each person’s income using the evidence relevant to their circumstances and then consider the household’s overall affordability.
Contractors do not automatically pay a higher mortgage rate because of the way they work.
The rate available will depend on the lender, product, deposit or equity, credit history, property and strength of the overall application.
Where the circumstances require a more specialist lender, the pricing and fees may differ from standard mortgage products.
Great customer experience! John was brilliant start to finish and really supported us throughout the whole process. Bridging loans were all new to us so John really took the time to make sure the loan was right for us, along with explaining everything in detail. We had a short timescale and John again made sure this was pushed along at each point in the process
Adviser: John Symons
You may already have found a property, be preparing to move or want to understand your borrowing position before taking the next step.
Tell us how you work, how you are paid, the value of your current contract and the amount you may need to borrow.
We will review the initial information and contact you to discuss how your income may be assessed, which mortgage routes appear realistic and what documents are likely to be required.
Your home may be repossessed if you do not keep up repayments on your mortgage.
Jayhawk Capital may charge a tailored broker fee of up to 1% of the loan, subject to a minimum fee of £500.
For residential mortgages, the fee is generally payable when the mortgage offer is issued. The amount and payment stage will be confirmed before you decide to proceed.
Your contractor mortgage may also connect to other areas of property finance. Explore related services offered by Jayhawk Capital.
