How long do I need to have remaining on my contract?

In general most lenders will require 4 to 6 weeks remaining on your contract although we can often negotiate on this and with some help from your agency 'talk up' your prospects of a renewal/extension contract for mortgage purposes.

Previous page about arranging mortgages for contractors

How long does will it take to complete my mortgage?

All lenders are different and it also depends on whether there is a back-log of applications due to a promotion or preferential rate. Obtaining an "agreement in principle" only takes an hour from receiving your mortgage application. Once the valuation of the property has been received by the bank and the necessary legal searches performed by your solicitor the whole mortgage process generally takes 4-5 weeks maximum.

What supporting documentation will I need to provide?

The following documents will be required to package your mortgage application to the underwriters:

1. Proof of ID (a copy of a passport or driving license will do fine)
2. Proof of address (utility bill, credit card or bank statement)
3. A copy of your latest contract, confirming your contract rate
4. A copy of your latest CV may be requested

Will I need to provide accounts?

You won't need to rely on the traditional method of using 2-3 years accounts, which for most contractors does not fully reflect the total earnings that you have at your disposal for income verification. It is far better to simply work from your contract rate alone.

What will my upfront costs be?

Unlike other mortgage advisers, we do not charge a broker fee for our mortgage service - we rely solely on introducer commissions, received from the lenders. For remortgages, most of the lenders that we deal with cover the cost of the valuation and legal fees, and in some cases arrangement fees. For home movers and first time buyers the majority of lenders charge a valuation and arrangement fee to book a particular mortgage deal. Quite often we can secure mortgage products where the banks will pay some or all of these fees for you as an incentive.

What about stamp duty?

From 25 March 2010 up to 24 March 2012, first-time buyers can claim a relief from stamp duty if the amount paid for the property is under £250,000.

Will I have to accept costly extended tie-in charges to secure a mortgage?

A number of mortgage schemes feature attractive initial interest rates for the first 12 months and then jump to higher rates for a further two years with penalties charged if you move to another lender. We have always steered clear of these types of mortgage schemes. We can recommend a wide range of competitive mortgage deals that give you total flexibility to move your mortgage loan at any time or when your special rate expires.

What happens to my mortgage rate after the initial rate expires.

Unless you're on a life time tracker rate, your initial mortgage rate will revert to the lenders standard variable rate. Too often people become complacent and allow the new reversionary rate to set in once the initial rate expires. The good news is that we contact all our clients at least 8 weeks before the expiry of any preferential rate, to examine all available options. We check what the retention rates are from the existing lender and compare them with what the remortgage rates are from different lenders. On many occasions we can transfer you to a new competitive mortgage rate with the current lender you are with. However, if there are better mortgage rates available from other lenders, it makes sense to transfer your mortgage loan to a more competitive mortgage scheme. We can often arrange with these lenders to pay for all fees to move your loan across to their mortgage scheme. This typically includes the cost of the valuation and legal fees.

At Freelancer Financials, we are always keeping an eye on market conditions and interest rate trends to ensure that you always secure competitive interest rates throughout the life of your mortgage.

Is it compulsory to take the lenders insurance with my mortgage?

Our mortgage advisers will always try and ensure that there are no hidden surprises or charges when making our mortgage recommendation to you. We will always exclude mortgage schemes from our proposals that insist on you taking out the lenders uncompetitive home insurance etc. This also includes banks that stipulate that you have to take their life insurance and protection cover. As responsible financial advisers we encourage you to consider life, critical illness and income protection cover, as it is important to ensure that your mortgage loan is adequately protected. On request our protection specialist would be happy to provide a no obligation quote and advice on your protection needs.

What do I do next?

Complete the form here and one of our mortgage advisors will contact you by email with recommendations and mortgage options tailored to your requirements.

Freelancer Financials are specialists in the field of providing mortgage advice to contractors and freelancers. For a mortgage quote please contact our contractor mortgage specialist John Yerou on 020 8421 7998.