£500 × 5 days × 46 weeks = £115,000 annualised contract income. At 4.5 times that is around £517,500; at 5 times, around £575,000. With a 10% deposit, that points to a purchase price in the region of £575,000 to £640,000.
Those figures are indicative. What you can actually borrow depends on the lender and your wider circumstances — and on a £500 day rate, the spread between lenders is unusually wide.
Contractor A is outside IR35 through a limited company, 18 months contracting, six months remaining on the contract. Well served: multiple lenders will annualise the gross rate.
Contractor B is inside IR35 through an umbrella, three months remaining, ten years in the profession. Fewer lenders will use the assignment rate; several default to payslips, producing a materially lower assessed income.
Contractor C is outside IR35, two months into a first contract, previously £90,000 PAYE. A smaller group of day-one lenders will consider this, and the prior employment history is what carries it.
Same rate. Very different lender lists.
A longer contract term remaining at the point of application.
Clearing or reducing credit commitments before applying.
A longer mortgage term, where appropriate.
Opens better loan-to-value bands, and some lenders annualise over 48 weeks rather than 46.
Situation: No credit commitments, 15% deposit, six months remaining on contract.
Approach: Gross-rate lender with an enhanced multiple above £100,000 assessed income.
Outcome: £560,000 on a £660,000 purchase.
Situation: Payslip assessment produced £96,000 rather than £115,000, and £610 a month of car finance reduced affordability further.
Approach: Assignment-rate lender, application timed after the finance agreement ended.
Outcome: £395,000 agreed.
Situation: Previously £90,000 employed in the same field. Almost no contracting history.
Approach: Day-one lender assessing the full £115,000.
Outcome: £480,000 at 90% LTV.
Send us your contract and we will confirm which lenders will annualise your rate in full — and what that means for your maximum borrowing.
£500 a day annualises to around £115,000 over 46 weeks, pointing to roughly £517,000 to £575,000 at standard multiples, subject to affordability and lender criteria.
Potentially, with the right lender and deposit, but it depends on your credit commitments, dependants, term and the lender’s stress test.
A contract-based lender will annualise the £500 rate rather than your drawn income. A conventional lender will use the £45,000.
Yes. Four days over 46 weeks is £92,000 rather than £115,000, which typically reduces borrowing by around £100,000.
Deposits from 5% to 10% are available to contractors with the right profile, though a larger deposit widens the lender list and improves the rate.
