You're earning well, your income is clear, and you're ready to buy. The problem is most lenders don't know how to assess you — and that costs you borrowing capacity you've already earned.
Buying your first home as a limited company contractor should be straightforward. The difficulty is not your income — it's how most lenders measure it.
Specialist contractor lenders don't look at your accounts. They look at your contract. They take your current day rate, annualise it over 46–48 weeks, and apply an income multiple to that figure.
That is your real income — assessed correctly. The borrowing capacity it produces is often substantially higher than anything a high street lender would offer.
Day Rate Finance brokers who understand this methodology, know which lenders apply it, and manage the income evidence package to make sure your application goes to the right place first time.
Actual multiples vary by lender and individual circumstances. This is an illustrative example only.
Some lenders will accept day one contractors. You do not need years of contracting history — the contract itself is the income evidence.
Minimum 5–10% depending on lender and loan size. No specialist deposit requirements apply — the same as any first-time buyer.
No specialist credit hurdles for contractors. Clean credit, a reasonable CCJ-free history, and standard mortgage creditworthiness criteria apply.
Your current contract (day rate, end date, client name) and a CV showing your contracting history. Accounts are not always required when day rate assessment is used.
Personal and sometimes business bank statements — typically 3 months. Standard lender requirement regardless of employment type.
You do not need to accumulate years of contracting history before applying. If your contract supports day rate assessment, the length of time contracting is rarely a barrier.
Contractors can use Shared Ownership. Day rate assessment applies to the affordability calculation for the mortgage element — you are assessed on your contract income, not your salary draw. A useful route if you want to buy in a higher-cost area with a smaller initial mortgage.
The LISA allows you to save up to £4,000 per year with a 25% government bonus. If you're under 40 and building your first home deposit, it's worth considering as a deposit vehicle. Contributions can be made from personal income regardless of employment structure.
The Mortgage Guarantee Scheme runs through high street lenders. Day rate assessment typically does not apply through these products — if you use this route, you'll be assessed on the standard salary + dividends basis. For most contractors this means the scheme is less attractive than a specialist contractor mortgage at a higher deposit.
Help to Buy closed to new applications in 2023. It is no longer available.
Your bank almost certainly does not offer day rate assessment. They will assess you on salary and dividends and offer you a materially lower loan — if they agree to lend at all.
A broker unfamiliar with contractor lenders will place you with the lender they know — which is rarely the right lender for day rate income. The methodology matters as much as the rate.
Most contractor lenders require only a current contract, not years of history. Waiting unnecessarily costs you time in a market that moves.
Contractors who've been quoted low figures by the wrong lender often start viewing below their real means — and buy a smaller property than they needed to.
Each full application leaves a hard credit search. Multiple searches in a short period damages your credit profile. Get an Agreement in Principle from the right lender once, rather than applying to several wrong ones.
Day Rate Finance specialises in contractor mortgages from day one. Tell us your day rate and we'll give you an honest assessment of your borrowing capacity — before you start viewing. No obligation, no hard credit search at this stage.
See our fee structure — standard residential mortgages are handled at zero broker fee.