Already contracting and looking to buy your first home? Contract-based underwriting often provides significantly higher borrowing capacity than traditional employed assessment, opening up better property opportunities.
Many first-time buyers don’t understand how their contractor income will be assessed for mortgages, often underestimating their borrowing capacity.
Contractor first-time buyers often worry whether they can access Help to Buy, shared ownership, and other government schemes with their income structure.
Contractors may not realize that their high day rates enable faster deposit accumulation and access to low-deposit mortgages.
High street lenders often don’t understand contractor income, leading to declined applications despite strong earning capacity.
Availability: All specialist lenders offer Help to Buy with contract-based underwriting Benefit: 5% deposit, government provides 20% equity loan (40% in London) Assessment: Based on your contract day rate using standard calculation Advantage: Contractor day rates often qualify for higher property values
Access: Specialist lenders provide shared ownership for contractors Flexibility: Contract-based underwriting works with shared ownership calculations Benefit: Lower deposit requirements and reduced mortgage amount Growth: Can increase ownership share as day rates improve
Eligibility: 30-50% discount on new build properties Income Limits: Often easily met due to regional variations Assessment: Contract day rate used for affordability calculations Local Connection: Available in areas with high contractor demand
Availability: Many specialist lenders offer 95% LTV to contractors Benefit: Just 5% deposit required for first-time buyers Assessment: Full contract-based underwriting with minimal deposit Competition: Multiple lenders compete for first time buyer contractor business
Essential Documents
Additional First Time Buyer Requirements
Proof of Deposit Source: Bank statements showing savings accumulation
Gift Letters: If the family provides deposit assistance
Bonus Confirmations: If using an employment bonus for deposit
Help to Buy Registration: If using government schemes
What You Don’t Need
Week 1: Contract Start and Application
Day 1-7: Start contracting, confirm day rate and contract terms
Day 7-14: Initial mortgage consultation and document gathering
Week 2-3: Formal Application
Week 2: Submit mortgage application with specialist lender
Week 3: Mortgage offer typically received
Week 4-8: Property Search and Purchase
Week 4-6: Property search with confirmed budget
Week 6-8: Offer acceptance and legal completion
Total Timeline: 6-8 weeks from first contract to keys
Client: Emma, Junior Developer
Situation: Contractor for 6 months, unaware of borrowing potential
Day Rate: £400/day
Previous Assumption: Could only borrow based on net take-home pay
Contract Assessment: £400 × 5 × 46 = £92,000 annual income
Halifax Result: £414,000 borrowing capacity
Property Purchase: £435,000 London property with Help to Buy
Key Learning: Contract-based assessment revealed true borrowing power
Client: James, Management Consultant
Situation: Established contractor wanting to buy their first home
Day Rate: £600/day
Challenge: Assumed government schemes wouldn’t work with contractor income
Contract Income: £600 × 5 × 46 = £138,000 annual
Nationwide Result: £621,000 borrowing approved
Help to Buy Success: £650,000 property with 5% deposit + government loan
Outcome: Government schemes are fully accessible to contractors
Client: Sarah, Cloud Engineer
Background: 3 years employed at £55,000, moved to £750/day contracting
Application: Day one of the first contract
Contract Income: £750 × 5 × 46 = £172,500 annual
Halifax IT Terms: £862,500 borrowing capacity (5x multiple)
Purchase: £750,000 property with 95% LTV mortgage
Timeline: Keys within 8 weeks of the first contract start
Advantage: Specific first time buyer contractor products IT Preference: Enhanced terms for technology contractors Help to Buy: Full range available with contract-based underwriting Support: Dedicated first time buyer specialist teams
Products: Entire first time buyer range available to contractors Flexibility: Up to 12 weeks' contract gaps accepted Innovation: Helping Hand products work with contractor income Support: Strong first time buyer support and guidance
Approach: Manual underwriting is ideal for first time buyer contractors Range: Full product suite, including offset mortgages Innovation: Flexible termsare often better than high street equivalents Growth: Products designed for income progression
Focus: Attractive rates for first time buyer contractors Assessment: Contract-based underwriting with competitive terms Support: Specialist first time buyer guidance Innovation: Products designed around contractor earning patterns
Contract-based underwriting often reveals much higher borrowing capacity than contractors expect, making previously unaffordable properties accessible through specialist mortgage assessment.
Many first-time contractor buyers discover they can afford significantly better properties than they could access in previous employed roles, though this requires proper mortgage advice to achieve.
Calculate your borrowing capacity and identify best first time buyer products for your circumstances.
Assess Help to Buy, shared ownership, and other schemes to maximize your purchasing power.
Determine optimal deposit level and identify any family assistance or government support available.
Access first time buyer specialist teams at contractor-friendly lenders.
Armed with confirmed borrowing capacity, begin property search with confidence.
Ans: Yes, if you were previously employed in similar work. Most specialist lenders approve first-time contractor applications immediately.
Ans: Usually significantly more. Contract day rates typically allow 2-3x higher borrowing than equivalent employed salaries.
Ans: Absolutely. All major government first-time buyer schemes work with contract-based underwriting through specialist lenders.
Ans: No, 5% deposits are available to contractor first time buyers, same as employed applicants.
Ans: Perfect timing. Many contractors successfully purchase within their first month of contracting.
Ans: Yes, joint applications combining contractor and employed income work well with specialist lenders.
