How much can I borrow?

Most contractors are paid day (or even hourly) rates rather than a set monthly salary and they usually work on fixed term contracts. Both of these factors often send traditional lenders into a spin as they try to determine the amount you can borrow.  Traditional lenders often prefer borrowers with a full-time job and a monthly salary and are wary of contractors who work on rolling contracts without payslips. Contractor friendly lenders adopt a different approach.

Contractor friendly lenders will assess the income of contractors on a day rate multiplied by 5 (days) to give a weekly income and, dependent on the lender, this is multiplied by 46 or 48 weeks to come to an annual income figure.

The majority of lenders will lend 4.5 x income, some may lend up to 5 x your annual income.