Contractor Mortgages

Contractor Mortgages: Tailored Support from The Mortgage Store Cheltenham & Gloucestershire

Contractors often enjoy the flexibility and freedom that their work style provides. However, this way of working can come with challenges, particularly when it’s time to secure a mortgage or other types of borrowing. But don’t worry—at The Mortgage Store Cheltenham & Gloucestershire, we specialise in helping contractors find the right mortgage options, often at rates you won’t find by going directly to lenders.

Here’s everything contractors need to know about securing a mortgage:

How Contractors’ Income is Assessed

When applying for a mortgage as a contractor, most lenders will ask for evidence of your income over the past 1–3 years. The requirements can vary, with some lenders being more flexible than others.

Lenders typically calculate an average income over a specific period to estimate your future earnings. If your income fluctuates, they may use the lowest earnings point or your most recent figures—this could reduce your borrowing potential. That’s why working with an experienced mortgage broker is essential; we can identify lenders who better understand the nuances of contractor income.

Day Rate Mortgages

Some lenders use your daily contract rate to calculate how much you can borrow. They might multiply your day rate by the number of working days in a year (often 46–48 weeks) to arrive at a figure. However, they may also factor in breaks between contracts or unpaid holidays.

In many cases, lenders will ask for evidence of a 12-month contract or proof of ongoing work. At The Mortgage Store Cheltenham & Gloucestershire, we’ll help you find lenders who offer competitive terms based on your contractor status.

Tips to Strengthen Your Contractor Mortgage Application

• Secure Longer-Term Contracts: Lenders feel more confident when you can demonstrate long-term stability in your work agreements.
• Improve Your Credit Score: A higher credit score can enhance your application and improve the rates available to you.
• Organise Your Finances: Keep up-to-date records, including accounts, tax returns, and proof of ongoing contracts.
• Consult a Specialist Mortgage Broker: A broker like us understands the challenges contractors face and knows which lenders are most likely to offer favourable terms.

Let Us Help You

At The Mortgage Store Cheltenham & Gloucestershire, we’re experts in contractor mortgages and can guide you through the process with ease. Whether you’re just exploring your options or ready to make an application, we’ll provide tailored advice and access to lenders who understand contractor income structures.

Contact us today for a no-obligation chat and take the first step toward securing your dream home!