Mortgage as a Contractor
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Mortgage as a Contractor (Part 1)
Anthony McQuilliam explains how the mortgage process works for contractors.Podcast approved by The Openwork Partnership on 17/12/2025.
Can contractors get a mortgage? How long do you have to be a contractor to get a mortgage?
It depends on the kind of contract you’ve got, and each lender is completely different. If you are a day rate contractor where you’re paid a certain amount per day, the industry can be a factor. Lenders can be more flexible for those in IT, for example.
As a general rule of thumb, as long as you’ve got six months’ earnings behind you, the majority of lenders are available to you. If you’ve got proof that you’ve been contracting for two years, you will have a lot more options.
What are the lending criteria for contractors? How will my income be assessed?
It depends on the kind of contract you’re on. For a day rate contractor there can be slightly different calculations with each lender. They usually look at your day rate, work that out over five days and then multiply that by 46 or up to 52. They often assume you work 46 weeks a year to allow for holiday.
There’s also a different kind of contractor as part of the Construction Industry Scheme (CIS). With these contracts, lenders work out the average income over your last three months and multiply the average weekly pay by 46 to 52. That’s the figure they use as your income. It all depends on how you’re paid and what industry you’re in.
What documents do I need to get a mortgage as a contractor?
First of all, you would need proof of your contract. It could be what you’ve been paid for the last three months, if you’re a CIS worker, or for a day rate contractor they would want to see the contract from your employer.
Sometimes they like to see proof of both the contract you’re on and also the previous one. Everything else is standard – ID, bank statements, a copy of your credit report, proof of deposit.
Although some lenders do work with particular types of contract, others will still assess you as self-employed – which means you’d need your last two years accounts or your tax calculations and tax year overviews.
Can I take out a joint mortgage as a contractor with another person?
You can. They would assess you based on your contractor income, and depending on the lender they may apply different income multiples on your day rate. If your partner’s employed, they would assess that person on an employed basis with their last three months’ payslips, and a copy of any bonuses.
What deposit will I need as a contractor? Will I need a bigger mortgage deposit as a contractor?
A contractor looking at getting a mortgage won’t need any more deposit than anyone else. The majority of lenders will give you a 5% deposit mortgage. A few weird and wonderful lenders may allow you to just put down a £5,000 deposit, or offer you a 100% mortgage.
It massively depends on your personal situation and your credit file, but the deposit criteria for a contractor is no different than for anyone else.
How much can I borrow as a contractor?
It depends on the lender. It would generally be between 4.5 to 5.5 times your annual income, and some now go up to six times.
If you’re on a daily rate of £500, over a week you’d have £2,500 in income. Depending on the lender, they would then multiply that by 46 or 52 weeks and then apply the income multiple to that annual total.
If your partner’s working, their salary will also go into that income multiple. There may then be some subtractions depending on how many dependents you have and any credit cards, loans or hire purchases. Overall, it should be the same process for anyone applying for a mortgage.
How do I get a mortgage if I contract under a limited company?
This changes things slightly. Some lenders will still assess it based on your daily pay, worked out weekly and then annually. Other lenders would treat you as a limited company director, and rather than looking at the day rate, they would look at the net profits from the business and the salary you’ve paid yourself.
How does affordability work if I’m on a day rate?
If you had a day rate of £500, we would work out your weekly rate and then, depending on the lender, they may multiply that by 52 or 46 weeks – because lenders know you’re going to have holidays.
Based on that annual calculation, they would apply an income multiple. This is why if you’re looking to maximise your borrowing, it’s worth speaking to somebody that has experience in this.
You might try to do this on your own, and the lender you approach will give you 46 weeks, but another one would give you 52. That’s an extra six weeks’ salary. If your day rate gets you £2,500 a week – that could potentially be up to £15,000 in annual income, which could give you a massive amount of extra borrowing.
Can I get a Buy to Let as a contractor? Any differences in the Buy to Let mortgage process here?
The difference is that with a lot of Buy to Let options, they don’t assess your income. It’s less based on how much you earn and more based around the rental income from the property.
Lenders usually need you to have a minimum income for a mortgage, usually in the region of £25,000, but the loan is calculated based on the rental income for the property. They just check you have an income in case of issues – to cover any bad tenants or repairs.
Can I get a mortgage as a contractor with bad credit?
If you’ve got bad credit as a contractor, getting a mortgage can be done – but it limits your options.
There are lenders that can still potentially accept you with a 5% deposit, depending on how recent and how bad that credit actually is. The majority of bad credit lenders usually need you to have around a 15% deposit.
You’re seen as higher risk because you’ve missed payments in the past, and a bigger deposit gives them peace of mind. You’ll put some of your own funds into it, and that reduces the chances of them losing money.
What else do we need to know about mortgages for a contractor?
We’ve covered a lot there. As we mentioned, if you’re trying to sort this out on your own and you’re aiming for the maximum mortgage to buy the home of your dreams, finding the right lender is key.
One lender may only give you 46 times your weekly pay, while another might go to 52 times. That can make a dramatic difference to the quality of the property you and your family can move into.
It helps to have a conversation with someone experienced who knows which lenders will treat your contract a certain way. We can save you a lot of time and potentially get you a bigger mortgage if you need it.
Key Takeaways:
- While many lenders are available with six months’ earnings, having proof of contracting for two years significantly increases your options.
- For day rate contractors, income is calculated by multiplying the daily rate by five days and then by 46 to 52 weeks. Construction Industry Scheme (CIS) contractors have their average weekly pay over the last three months multiplied by 46 to 52 weeks.
- Lenders vary significantly in how they calculate your annual income, which can result in a massive difference in the amount you can borrow. It’s recommended to consult an experienced broker to maximise your borrowing potential.
- As a contractor, you generally won’t need a larger deposit than anyone else; the majority of lenders offer a 5% deposit mortgage.
- If you contract under a limited company, some lenders will still assess based on your day rate, while others will treat you as a limited company director and focus on the net profits of the business and the salary you have paid yourself.
YOUR PROPERTY MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON YOUR MORTGAGE.
MOST BUY TO LET MORTGAGES ARE NOT REGULATED BY THE FINANCIAL CONDUCT AUTHORITY.
Approved by The Openwork Partnership on 17/12/2025.
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Mortgage as a Contractor (Part 2)
Anthony McQuilliam continues the conversation on the mortgage process for contractors.
Podcast approved by The Openwork Partnership on 17/02/2026.
Are there any government schemes for contractors?
There aren’t any government schemes for contractors at the moment, although this does change on a regular basis as different schemes come out.
As of today, in February 2026, there are no particular government schemes specifically to help contractors to get a mortgage.
How does the mortgage process work if I’m a subcontractor?
It depends. There are a couple of different ways you could be subcontracting. For example, you may be a construction industry scheme (CIS) subcontractor, in which case some lenders will just want to see your last three months’ payslips.
From those, they average out your income for the year, rather than assessing you on a purely self-employed basis.
Can I get a mortgage as a contractor inside IR35?
IR35 is more of a tax thing, where you need to have a conversation with your accountant.
We can’t give you too much advice around that. But if you are a contractor, there is no reason why you can’t get a standard mortgage.
IR35 doesn’t really come into play when lenders assess you. It’s your accountant’s job to sort that out for you.
Can I get a mortgage on a temporary contract?
Yes, you can get a mortgage on a temporary contract, although it becomes a little bit harder. In some lines of work, contracts are always temporary – typically lasting 12 or six months, with another one lined up afterwards.
If you’re in an industry where there are constant temporary contracts on offer, or you’re with the same firm and getting the contract extended, you can potentially get a mortgage.
However, if you’ve just started a temporary contract which has a clear end date and you’ve got no history of contracting in that line of work, you may have a few issues in finding a lender.
Can I get a mortgage on a zero-hours contract?
Yes, it just depends on the lender you speak to. Some lenders are more flexible and will just want to see the last three months’ payslips on the zero-hour contract – although those are few and far between.
A lot of lenders will want to see at least a 12-month history on that zero-hour contract. Overall, they need proof that you are receiving a certain amount of money, long-term. By the nature of a zero-hour contract, you’re just not guaranteed to always have a steady level of work.
Can I get a joint mortgage as a contractor?
You can. If you’re applying with your partner, a lender breaks the income criteria down separately for you and your partner.
For example, if you’re a fixed-rate contractor or a day rate contractor, the lender assesses your income down that particular route. Then, if your partner’s a full-time employee, they would just use their salary.
You can still get a joint mortgage – they just assess each individual income based on that lender’s criteria and then add them together.
How does the remortgaging process work as a contractor? Any differences?
The way lenders assess your income is still the same. The only difference with a remortgage is that you’re not buying a property – you’ve already got a mortgage on your house and you’re just looking at getting a better deal.
You need to look into your remortgage about six months before your current deal expires. You will still need the same income documents – such as payslips, contracts, bank statements and ID. We’ll get the mortgage application process done nice and early, so the day your current mortgage expires, the new one takes over and you start paying the new lender.
What do I need to do to apply for a mortgage as a contractor?
It’s best to get advice long before you’re ready to buy a property, especially as a contractor.
Have a conversation with an adviser, whether that’s with a bank or a mortgage broker. Based on how much you’re earning, we’ll confirm rough affordability and check if there are any glitches with your credit score that you need to get sorted out.
Having that conversation nice and early in the process puts you in a really good position to iron out any kinks before you make the application.
Remember that not all lenders look at contractor income favourably – some can be really rigid and might just turn the application down or give you a lower borrowing amount.
A mortgage broker who deals with these cases on a day-to-day basis can save you so much time, allowing you to get on with your job and your life. We know which lenders to look at and how they assess contractor income. There may be ways we can get you a bigger mortgage than you could get direct.
We also have access to more rates than with your own bank, so we’ll have more options for you there, too.
What steps can I take to strengthen my mortgage application as a contractor? Any top tips?
The longer you’ve been contracting, the more favourable and plentiful your options with lenders. If you’ve been doing it for two years, that opens up the vast majority of lenders.
Checking your credit score is really important. So many clients we speak to have had a small glitch on a phone that they forgot to cancel. It ends up going into default, and you end up with poor credit on something avoidable. Check your credit score early on to iron out any issues.
Last but not least is your deposit. The bigger your deposit gets in increments of 5%, you find interest rates get a bit cheaper, lenders become more lenient on credit scoring, and they can potentially lend you more money.
If you have a 14% deposit on the property you want to buy, it’s worth waiting until you have 15% – it unlocks a new set of rates and credit score flexibility. Overall, it will just give you a better experience.
You’ve demonstrated how a mortgage broker can help – is there anything else you’d like to add?
I think we’ve covered most of it. But, to emphasise, contractor mortgages aren’t as difficult as you might think. It is complicated if you don’t know where you’re looking. You could be disheartened if you’re talking to a lender who can’t give you the mortgage you need.
Having a conversation with someone experienced in this area will put you in a much better position. We can look at all the options, lenders, and make the whole process a lot easier for you.
Key Takeaways:
- There are no particular government schemes specifically designed to help contractors secure a mortgage (information correct as of February 2026).
- Contractors can obtain a mortgage on a temporary or zero-hours contract, but lenders generally seek proof of long-term earnings, often requiring at least a 12-month history on a zero-hour contract or evidence of constant contract availability in a particular line of work.
- IR35 is mainly a tax issue for your accountant to sort out and does not typically come into play when lenders assess a contractor for a standard mortgage.
- To strengthen a mortgage application, contractors should check their credit score early to resolve any issues and aim for a larger deposit; increasing the deposit in 5% increments can unlock better interest rates and greater flexibility from lenders.
- It is best to consult with a mortgage broker, as they have access to more rates and are experienced in knowing which lenders assess contractor income favourably, potentially securing a bigger mortgage than applying directly to a bank.
YOUR PROPERTY MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON YOUR MORTGAGE.
For specialist tax advice, please refer to an accountant or tax specialist.
Approved by The Openwork Partnership on 17/02/2026.
Your home may be repossessed if you do not keep up with your mortgage repayments.