Contract-based underwriting largely grew up around IT contracting. Underwriters at contractor-friendly lenders are used to seeing day rates between £350 and £900, twelve-month engagements with three-month renewals, agency intermediaries, and limited companies with minimal drawn income. None of it needs explaining.
That familiarity is worth something in practice: fewer queries, fewer referrals to a senior underwriter, faster offers.
Common in IT and a frequent sticking point. A lender requiring six months remaining will decline a three-month rolling contract on day one of its term. Lenders that understand the sector look instead at whether the contract has been renewed repeatedly with the same client, and treat that renewal history as evidence of continuity. If your contract rolls, apply early in the term rather than late.
Keeping a record of each renewal — dates, rate changes, and the client name — makes it easier for a broker to build the continuity case, particularly with lenders who ask for evidence of the pattern rather than taking it on trust.
Where renewal history is thin, it may still be worth applying early in the term and being upfront about the rolling structure, since some lenders will still proceed if the remaining term criteria is met at the point of assessment, even without a long renewal history to point to.
£600/day, outside IR35, limited company, two years contracting — assessed around £138,000, broad lender choice.
£750/day, inside IR35, umbrella, four years of assignments — assessment depends on assignment rate versus payslip.
£550/day, first contract, previously £85,000 employed at the same client — a day-one case.
£900/day, three-month rolling contract — high income, short term remaining.
Most IT contracts sit between the contractor, an agency and the end client. Lenders are used to this. Provide the agency contract and, where available, upper-level confirmation of the engagement.
The same underwriting applies to engineering, telecoms, finance and project management contracting. Rates and contract lengths differ; the mechanics do not.
Where the agency structure involves more than one intermediary, it’s worth confirming with the agency in advance who can provide the upper-level confirmation, as delays here are a common cause of slow applications rather than any issue with the contractor’s own position.
Situation: Two lenders required six months remaining. His contract never ran longer than three.
Approach: A lender accepting a two-year renewal history with the same client as evidence of continuity.
Outcome: £690,000 at 80% LTV.
Situation: Contract with an agency rather than the end client, which the applicant assumed would be a problem.
Approach: Standard gross-rate assessment; the agency structure was never queried.
Outcome: £495,000 agreed, offer in 11 working days.
Situation: Same role, same employer, new contract structure, and no contracting history.
Approach: Day-one lender assessing the £126,500 annualised rate on the strength of four years’ employment in the role.
Outcome: £430,000 at 85% LTV.
Send us your contract, whether it is with an agency or direct. We will place it with underwriters who see cases like yours every week.
Yes. IT contracting is the sector contract-based underwriting was built around, and a wide range of lenders will annualise an IT contractor’s day or hourly rate.
No. Agency intermediation is the norm in IT contracting and lenders expect to see it. Supply the agency contract with your application.
Often yes, particularly with a history of renewals with the same client. Some lenders require a longer minimum term remaining, so apply early in the contract term.
Only if it affects your own contract. A signed contract that is running stands on its own terms.
Yes. The underwriting mechanics are identical across IT, engineering, telecoms, finance and project management contracting; only rates and contract lengths differ.
