Scottish Widows is a great lender who will accept and consider applications from day rate contractors and hourly rate contractors.
Scottish Widows also offer offset mortgage products, which is great for the financial aspect for contractors and freelancers. The lender will open a linked savings account that will either reduce the monthly payment or balance, whichever you prefer.
Whether you are a contractor operating through your limited company or through a payroll umbrella, Scottish Widows will take a view and consider your application.
Scottish Widows policy towards day rate contractors is as follows
- Scottish Widows has no minimum daily rate for IT contractors, so you could be on a day rate of £100 and Scottish Widows will accept your application, Scottish Widows absolutely love IT contractors and freelancers.
- If you are not an IT contractor, then you must have a day rate of at least £312.50 in order for them to accept your contract and consider you under their contractor policy.
- Scottish Widows will consider day rate contractors even if the contract is a first contract, and you have been a permanent employee on a PAYE basis, all they ask is that you have been working in a similar role for the previous 2 years.
- Scottish Widows will want to see some time remaining on your contract, like 4 weeks, you do not need a lengthy time remaining, they understand that contracts are short term and do not insist on more than four weeks, if you have less than this, they will more than likely ask for an extension or new contract that you will be moving onto.
- Scottish Widows do not like gaps in employment history, they want you to be working continuously in the preceding 12 months, obviously, having holiday or taking a few weeks out is not an issue, but if you have several months off in the 12 months, then it may be better to look at one of our other contractor friendly lenders.
Scottish Widows will calculate your gross contract value in the following way:
- Scottish Widows tend to take your day rate then multiply by 5 days then multiply this by 48 weeks to reach the gross contract value.
- They will not utilise the average of the previous year to reach an average day rate.
- For example, if on a day rate or hourly rate
- £350 per day x 5 days x 46 weeks = £80,500 gross contract value
- £42 per hour x (number of hours stipulated or 37.5 hours default) x 48 weeks = £72,450 gross contract value
In order to package your application, we will require:
- Proof of ID such as Passport or DVLA Licence
- Proof of Address such as Utility Bill and Council Tax Bill
- Current Contract with the Terms and Conditions, needs to be signed and dated
- 3 months personal and business bank statements
- Lenders Direct Debit Mandate, Offset Declaration and Telephone banking Form
- If purchasing, then we will require proof of deposit or a gifted deposit letter and requirements if this is being gifted, we will provide you with the template for the letter required.
Having everything up front makes our job easier and ensures that we can present your application to the Scottish Widows contractor mortgages department in a presentable fashion so that they can swiftly make a decision that will be positive.
Let the experts at Contractor Mortgages Direct take your application forward, get the professional advice your application deserves.
