Mortgage for Subcontractors

How much can subcontractors typically borrow based on their income?

As a subcontractor, your income will affect how much you can borrow. Banks will decide how to assess your income – perhaps that self-employed route or based on the contracted income. They’re also looking at any financial commitments such as credit card balances, loans, car finance, childcare commitments, nursery fees…all those things are included in the full affordability assessment.

If you have any financial dependents, like children or adult dependents, they are factored in as well. Lenders look at your credit score, the deposit you’re putting in and the type of property you’re looking to buy.

I wish I could give you a general rule – it’s not as simple as every lender multiplying your income by 4.5 and that’s what you can borrow. There are complex assessments and calculations, and we don’t even get to see how they work.

The best way to get a detailed answer is for us to get an understanding of your situation, your needs and your preferences. We’ll go through an affordability calculator together to help you understand how much you can borrow.

Can subcontractors use their self-employed status to get a mortgage?

Yes, they could. It does depend on lots of things – how long they’ve been doing it for, the setup, the contract type, whether they have set up a company for contracting, and the performance of the business itself.

Lots of different variables are taken into account. A lot of lenders would look at subcontractors as self-employed anyway, but it will vary based on multiple things.

Again, that’s where we can come in, to explain which approach is best to present you to the bank – as self-employed using your tax returns, or just providing your contract, for example.

Do subcontractors’ mortgages usually come with higher interest rates?

It depends on those multiple factors. If a subcontractor has been contracting for over two years and has a pretty sustainable income, you’d be likely to get the same rates as anyone else. You wouldn’t necessarily face higher interest rates just because you’re a subcontractor.

Where this might be the case is if any factors limit your options. If you have been contracting for less than two years, for example, you’re going to be limited to fewer lenders.

Other factors might be your credit score – if you’ve had some missed payments in the past, that’s also going to affect the interest rate. But generally you’re not going to pay a higher interest rate just because you’re a subcontractor.

Can subcontractors with a bad credit history still get a mortgage?

Yes, potentially. It depends on the bad credit. You might have the odd missed payment on your credit file or something more serious like a default or CCJ – or even a bankruptcy or an Individual Voluntary Agreement (IVA).

With all of those, it depends on the severity. Some high street banks will consider a small missed payment, while other banks might accept bankruptcies and IVAs.

Those things can dictate how much deposit you might need to put down. We spoke about 5% being the minimum earlier, but something more complex might require a higher deposit and may come with higher rates, if you’ve got bad credit. But we can certainly help a subcontractor with bad credit.

Do you need to have worked as a subcontractor for a certain amount of time to qualify for a mortgage?

Most banks and building societies want you to have worked as a subcontractor for a certain amount of time. The required amount of time will depend on the bank or building society, and the longer you’ve been contracting, the more options you’ll likely have.

Usually the requirement is one or two years. Subcontracting gives you access to a lot of lenders, and two years or more will open up the majority of them. The longer you’ve been doing it, the more relaxed lenders are and the more options you’ll have.

But if you’ve just entered into contracting and you need to buy a home or remortgage before you reach the two year limit, there are still options.

What can subcontractors do to boost their chances of getting approved for a mortgage?

Preparation is key. It’s a common theme in our podcasts, and as a contractor you might need a little more documentation than someone who is employed.

If you run a business, you may need to have your accounts in order, plus copies of your contracts. That’s a big one. A lot of clients tend to put previous contracts in the bin or don’t keep copies. They have to spend time asking for new ones – avoid that by keeping your documentation.

Have a conversation with a broker as early as possible. You don’t need to wait until you’ve found a property or you’re ready to apply for a mortgage. You might just be thinking about it as a subcontractor. Just understanding what you need to do is the best thing to improve your chances of getting approved.

You’ve both demonstrated how a mortgage adviser can help, have you got anything else to add?

If you’re a subcontractor either looking to remortgage or buy a home, the easiest way is to get in touch with us and book in a discovery call.

That helps us understand your circumstances, your needs and how much you’re willing to pay on a mortgage. We’ll answer your questions and explain your mortgage options – how much you can borrow, the interest rates you’ll be looking at, and the documents to prepare.

We’ll look through your credit report and see if anything on there could limit you. So feel free to get in touch. We’ll help you understand what kind of mortgage you can get and talk you through the next steps.

Key Takeaways:

• Subcontractors can get mortgages, but lenders consider factors such as how long they’ve been subcontracting, their experience, and contract length.
• Lenders have different rules for subcontractors, with more options generally available after two years of subcontracting.
• Documents needed include photo ID, bank statements, proof of income (which can vary, such as tax calculations or contract day rates), and a credit report.
• The minimum deposit for a subcontractor mortgage is typically 5% of the property value, similar to other applicants.
• To boost approval chances, subcontractors should prepare documentation, keep copies of contracts, and speak with a mortgage broker early.
  
  

YOUR PROPERTY MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON YOUR MORTGAGE.

Approved by The Openwork Partnership on 11/11/2025.