The Woolwich (Barclays) are pleased to announce some positive changes to their mortgage product range with the launch of improved competitive loyalty, special and standard residential products on Wednesday 22 September 2010.
The Key changes are:
- New 70% LTV loyalty tracker which has seen rates slashed from 2.79% (BBR + 2.29%) to 2.48% (BBR +1.98%).
- New Fixed Rates with the headlines being their standard 2 year 70% LTV product which has been cut by 0.34% to 3.15% and their loyalty 5 year 70% LTV product which has been cut by 0.15% to 4.29%.
- Reduction of between up to 0.20% on our loyalty and special Offset trackers.
- Cutting the fee on their special Fixed Rate product by £500 to £1,499.
The majority of high street banks and building societies have a simplistic view of what qualifies as relevant earnings for borrowing purposes. Typically, Contractors working through a limited company are expected to produce at least 2-3 years accounts and be assessed on salary and dividend drawings alone. However, the majority of contractors working through a limited company draw a minimum salary and also restrict dividend payments to avoid higher rate tax.
Although this is a great tax planning it reduces the amount a contractor is able to borrow under the standard criteria used by most mortgage lenders. Woolwich, on the other hand have a more flexible lending policy towards contractors. Unlike other lenders, they only require 1 year’s accounts and take into account earnings which are not paid out but retained within the company for tax planning purposes.
If you have any questions about Barclay’s loyalty mortgages which give Barclays current account customer’s better deals on Woolwich mortgages please contact us on 020 8421 7998.
Freelancer Financials are specialists in providing contractor mortgages and financial services to freelancers. We are Financial Advisers that are directly regulated and authorised by the Financial Services Authority.
If you’re interested in finding out more about the mortgage options available to contractors buying their first home, please visit contractor mortgages for first time buyers.
