Your contractor mortgage experts
If you contract through a limited company, an umbrella, as a sole trader or on a fixed-term contract, the high street will often look at your tax return and offer far less than you can comfortably afford. We work with lenders who understand contracting and assess you on what you actually earn: your contract rate.
Help for contractors in their first contract, between contracts, inside or outside IR35, with limited trading history, or with complex income.
How a contractor mortgage actually works: borrowing on your day rate
This is the single biggest reason contractors use a specialist broker. Most high-street lenders treat you as self-employed and base their decision on the salary and dividends declared on your SA302. The result is a much smaller mortgage offer than your true earning capacity supports.
Contractor-friendly lenders take a different approach. Instead of accounts, they look at your current contract and annualise the rate using a simple formula:
Day rate × 5 days × 46 (or 48) weeks = annualised income
They then apply an income multiple, typically 4 to 5 times, to work out what you can borrow. The 46-week assumption allows for four weeks of holiday, a week of illness or training and a week between contracts; the more contractor-friendly lenders use 48 weeks for applicants with a strong track record.
Worked contractor affordability example
A contractor on £600 per day, comparing the two assessment routes:
Standard high-street assessment
Salary £12,570 + dividends £37,700 = £50,270 declared income
Approx borrowing at 4.5× income: £226,000
Day-rate (contract-based) assessment
£600 day rate × 5 days × 46 weeks = £138,000 assessed income
Approx borrowing at 4.5× income: £621,000
In this example the day-rate route nearly triples the mortgage offer. The numbers above are illustrative and your actual offer will depend on the lender, your credit profile, deposit, outgoings and other factors.
Who we help
We’re set up for the full spread of contracting arrangements:
Limited company contractors: Often a company director mortgage is the better route for higher earners with retained profit.
Umbrella company contractors: we work with lenders who will use the gross contract rate, not the umbrella payslip after deductions.
Sole traders and freelancers: assessed on day rate where the contract supports it, or on accounts where that produces a better outcome. See our guide to self-employed mortgages for more on how sole-trader income is treated.
Fixed-term contract (FTC) professionals: including teachers, NHS staff and consultants paid PAYE on rolling fixed terms.
CIS construction contractors: we know which lenders use gross CIS day rates and which insist on net.
Inside-IR35 contractors: IR35 status doesn’t have to limit your options; several lenders will still assess on the gross contract rate.
Newly self-employed contractors: applicants with less than two years of accounts, or in their very first contract, where prior PAYE experience in the same field supports the case.
Common situations we solve every week
“I’ve had a gap between contracts.”
Short gaps are normal in contracting and most specialist lenders understand this. We’ll match you with a lender whose policy on gaps fits your actual pattern of working.
“I’m coming back to contracting after a career break.”
Lots of contractors come back to work after parental leave, caring responsibilities or time out for other reasons. Lenders care far more about the strength of your current contract and your relevant experience than the length of any gap. We’ll find one whose criteria fit your actual timeline rather than a textbook one.
“I take a low salary and reinvest profit in the company.”
This is exactly the scenario day-rate underwriting was designed for. We can also place cases with lenders who will use net profit (rather than salary plus dividends) for limited company directors. For more information you can also see our Company Director Mortgages page.
“I’m contracting and my partner is on PAYE.”
Joint applications work well. Lenders apply their usual income multiple to the Pay As You Earn (PAYE) income and add the contractor income annualised from your day rate. The combined figure is often higher than either of you could reach alone. We just need clean documentation on both sides and a clear picture of any existing credit commitments.
What you'll need to apply
Contractor mortgage applications are document-led rather than score-led, and a well-prepared file goes through quickly. We’ll usually ask for:
- Your current contract (and CV showing relevant experience, if you’re newly contracting).
- Your three most recent months of business and personal bank statements.
- Proof of ID and address.
- Most recent SA302 and tax year overview, if available (not always required for pure day-rate cases).
- Latest set of limited company accounts, if you trade through a Limited company (ltd).
- Umbrella company payslips or remittance advice slips, if applicable.
We’ll review everything before anything is submitted, so you know what the lender will see and what they’ll say before they say it.
Our process
1. Discovery call. A short, no-obligation conversation about your circumstances, plans and timing.
2. Contract and income review. We look at your contract and assess how each part of the market will see it.
3. Lender matching. We identify the lenders most likely to give you the best outcome.
4. Decision in Principle. We secure a DIP so you can offer on a property with confidence.
5. Full application and offer. We package the case, manage the underwriter and chase the offer through to issue.
6. Through to completion. We stay with you, your solicitor and the lender right up to the day you get the keys.
Most contractor cases get a decision in principle inside 24 to 48 hours of submission. A full lender offer usually follows within two to three weeks once your paperwork is in. Foreign-currency contracts and some inside-IR35 cases take a little longer because the underwriter wants to see the specifics. We’ll give you a realistic timeline up front so you can plan your offer around what’s actually possible.
How much can I borrow as a contractor?
As a rough guide for day-rate cases, most contractor-friendly lenders will offer between 4 and 5 times your annualised day-rate income, provided your credit profile and outgoings support it. The table below gives ballpark figures using the standard day rate × 5 × 46 formula and a 4.5× multiple:
| Day rate | Annualised income | Approx max borrowing (4.5×) |
| £300 | £69,000 | £310,500 |
| £500 | £115,000 | £517,500 |
| £750 | £172,500 | £776,250 |
| £1,000 | £230,000 | £1,035,000 |
These figures are for illustration only. Actual lending decisions take account of credit history, deposit, outgoings, dependants, age and the specific lender’s criteria. Once you have an offer agreed, you may want to compare fixed rate mortgages against variable rate options to choose the right product structure.
How much deposit do you need as a contractor?
Most contractor mortgages are available from a 10% deposit, with stronger pricing kicking in at 15% and the most competitive end of the market sitting at 25% deposit and below. A 5% deposit is possible for a smaller pool of applicants, and for first-time-buyer contractors lenders generally want to see at least three to six months of contract history along with prior employed experience in the same field.
5% deposit (95% LTV): smallest lender pool. Day-one contractors are usually not accepted at this tier.
10% deposit (90% LTV): broad mainstream coverage. Best for contractors with at least six months trading.
15% deposit (85% LTV): sharper pricing. Most specialist contractor lenders compete strongly here.
25% deposit and above (75% LTV and below): best rates. Full range of fixed and variable options available.
Your actual offer depends on your credit profile, deposit source, dependants, age and the specific lender’s policy on day-rate cases.
Contractor mortgage rates: what to expect
Contractor mortgages don’t sit on a separate rate card. You’ll see the same fixed-rate and variable-rate products the rest of the market uses, and your rate depends on your deposit, your term, your credit profile and current market pricing rather than the fact that you contract. As a guide, day-rate-assessed mortgages from specialist lenders tend to price within a fraction of a percent of mainstream high-street pricing at the same loan-to-value (LTV) tier. The broadest choice of competitive rates appears from 75% LTV downwards. Rates move daily, so rather than publish a stale table here we’ll quote you live figures at decision-in-principle stage.
Frequently Asked Questions
A number of lenders will lend from day one of a contract provided you have relevant employed experience in the same field, usually evidenced by a CV. Some require the contract to have a minimum unexpired term (often three or six months); others are happy with an unsigned offer in writing. This is a common starting point for first-time buyers who have just moved into contracting.
Yes. Plenty of lenders actively want contractor business, the trick is being placed with the right one for your specific situation. We work with lenders whose criteria are built around day-rate income rather than against it. For a wider view of the lending landscape, see our specialist mortgages page.
The standard approach is day rate × 5 days × 46 weeks, giving an annualised figure that’s then used like a salary. Some lenders will stretch to 48 weeks for stronger applicants, some will average actual banked income across the most recent three or six months.
Contractor mortgages offer several benefits tailored to the unique financial situations of freelancers and self-employed individuals:
- Flexibility: These mortgages can be customized to accommodate irregular income and variable expenses, providing a more personalized lending solution.
- Competitive Interest Rates: Specialist lenders often offer competitive interest rates for contractor mortgages, which can help reduce monthly repayments and save money over the life of the loan.
- Increased Borrowing Power: Contractor mortgages can provide higher borrowing power than traditional mortgages, as lenders consider the contractor’s day rate and contract history.
- Simplified Application Process: Specialist mortgage brokers can guide contractors through the application process, making it easier to secure a mortgage.
By leveraging these benefits, freelancers and self-employed individuals can find mortgage solutions that align with their financial goals and circumstances.
A smaller pool of lenders, but it’s a workable case with the right preparation. We’ve placed mortgages for contractors paid in foreign currency by overseas-headquartered employers and intermediaries.
It can affect which lenders will accept your case, but it rarely closes the door. Inside-IR35 contractors are increasingly catered for, and the right lender will still annualise your day rate. The conversation just needs to happen up-front, with the right paperwork. You can read HMRC’s overview of off-payroll working (IR35) for background on how status is determined.
A contractor mortgage isn’t a different product, it’s a different way of assessing your income. The headline benefit is that lenders look at your contract rate rather than salary plus dividends, which usually means a much bigger usable income figure and a meaningfully larger mortgage offer. Specialist lenders also tend to be more comfortable with shorter trading histories, foreign-currency contracts, umbrella and CIS pay, and director income held inside a limited company. The catch is that the right lender for your case won’t always be obvious from the outside, which is where a broker who knows the market earns their fee. For more background on how lenders view non-Pay As You Earn (PAYE) income, our guide to self-employed mortgages is a useful starting point.
Most contractor mortgages are available from a 10% deposit, with the broadest range of rates available from 15–25%. A smaller deposit is possible in some cases.
Speak to a contractor mortgage specialist
Tell us a little about your circumstances and your plans, and we’ll come back to you with a clear view of what you can borrow and which lenders are the best fit. Whether you’re looking to buy your first home, remortgage an existing property, or explore the full range of our mortgage services, we’re here to help.
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