More mortgages granted to contractors than ever before
The council of Mortgage Lenders has revealed that August 2015 saw the rate of gross mortgage lending reaching the highest levels seen since 2007. As the third month of solid growth, year on year, lending reached £20 billion last month and August saw levels reaching their highest for eight years. The chief economist of the CML, Bob Pannell has attributed the high to an upturn in remortgaging activity and an increase in the rate of house purchasing during the summer, but he is also expecting continued modes growth over the coming months towards the end of the year.
With interest rates at record lows, demand is on the increase, and many lenders are offering mortgage products which require low deposits in addition to the number of current and existing government schemes. As the largest building society in the UK, Nationwide has revealed their latest range of mortgage products which only require a 5 per cent deposit.
Contractors are set to don particularly well out of this latest improvement as lenders are reportedly making more effort to appeal to this sector of the market, for example Nationwide have extended their lending criteria to those who have fixed-term contracts. They are using hourly and daily rates to calculate affordability with no restrictions on minimum income or sectors, both of which have been problematic for independent professionals in the past.
Virgin Money have also announced plans to completely review their lending policy which could make them a more viable option for contractors who want to secure finance at a reasonable rate, including their buy-to-let range which could provide more choice than there has ever been available before.
For contractors, who have traditionally had a hard time finding a lender who appreciates the position in which independent professionals find themselves, the fact that lenders are beginning to recognise that contractors are a viable option is good news for all concerned.
If you want to know more about what life is really like as a contractor, our contractor case studies contain plenty of information for those who are considering taking the plunge. We can also provide advice on the advantages and disadvantages of going limited and a range of other issues surrounding contractor tax to ensure that you are operating in the most profitable way possible which can be vital if you want to secure any type of lending.
For more detailed advice about buying property as a contractor, planning for your future, or just making the most of your income, call our friendly team today on 01442 275789 or email email@example.com.