This Contractor Mortgage Success Story involved a customer that was introduced to us earlier this year.
The customer is a contractor and she had been doing this for 2 years or so but the issue on this case however was that many lenders need there to be a period of time remaining on the contract – typically this is around 6 months plus.
On this particular case, due to the company restructuring there was nobody in a position to provide the contract extension of that length of time – or the people who could were that high up, it was not really something they did.
This meant all we could evidence for the application was 4 week extension periods until such a time as a senior manager had been hired.
What did we do?
Because the customer was self employed and worked via a limited company that she owned, we submitted the case as we would any other self employed applicantion and used self assessments instead of a contract.
The underwriter picked up on this and was not happy to lend in this way. Still to this day we are not sure why as it is within criteria, but their opinion was that the contract could end shortly and so they would not do it.
We then went to another lender whose rates were still normal and within touching distance of the first lender, their stance was a little more relaxed than the original lender and they just wanted to know whether it is expected that the contract will remain for the foreseeable future – which it was.
We submitted a new application to the second lender. The underwriter assessed the case and was ready to instruct the valuation. However, in that period, the employer had now taken on a manager who was happy to provide a contract with 6 months to run – so we were now able to go back to the original lender and get the Mortgage offered.
Sometimes even cases that should be straight forward do not go to plan but the lesson here is that as a whole of market broker we work tirelessly to get the best deal for our customers.
The case fit the criteria with the first lender and should have gone to offer based on how we packaged the case for the original application. However, we occasionally need to take a step back and think do we try to fight this case through by involving our account managers or do we find an alternative lender where the cost is not much different? In this case with no guarantee we would get the decision overturned and with Plan B costing more or less the same, we decided to go down another route.
This is a case that on the face of it, should have just flown through. However because an underwriter took a different view on this than we would have expected, we had to look at an alternative. There is nothing wrong when this happens, it can happen, thankfully not very often, but we got on with it found an alternative and bar maybe a few days hold up, everything would have been offered within 2-3 weeks.
If you are self employed or a contractor and are in need of some mortgage advice, give us a call and become our next Contractor Mortgage Success Story.