Skipton Contractor and Self-Employed Mortgages

How does Skipton Building Society accommodate gaps in employment history?

When you're applying for a mortgage with gaps in your employment history, the income assessment method adjusts accordingly to provide a fair evaluation.

Understanding the Adjusted Income Calculation

If there's a period where you weren't working — let's say, an eight-week gap — Skipton Building Society doesn't overlook these breaks. Instead, the income calculation is modified to ensure your overall income is fairly represented. Here's how it works:

• Daily Rate Consideration: Your daily earning potential is the starting point for the computation
• Weekly Adjustment: This daily rate is then multiplied by the standard workweek of five days
• Annual Estimate: Typically, a full working year is assumed to be 48 weeks. Any gaps, such as our eight-week example, would be deducted from this assumption, altering the final income estimate

By using this prorated method, Skipton Building Society ensures that periods out of employment don't disproportionately affect your financial assessment, providing a more accurate picture of your earning capacity.

What happens if a Skipton Building Society Underwriter needs more information?

When applying for a financial service, like a mortgage or loan, the process involves an underwriter reviewing your application details. Here's what you can expect if they require more information:

• Initial Review of Application: The underwriter closely examines your submitted documents to ensure all necessary information is provided. This includes income statements, credit history, and other personal details.
• Request for Additional Documentation: If the underwriter finds some information unclear or incomplete, they will reach out for more details. This request can come via email or phone, asking for specific documents or clarifications.
• Provision of Required Information: As an applicant, it's crucial to respond promptly. Gather the requested documents, whether it's proof of income, employment verification, or other financial records, and submit them in a timely manner to avoid delays.
• Underwriter Re-Evaluation: Once the additional information is submitted, the underwriter will re-evaluate your application. They will check if the provided documents clarify or complete the initial data.
• Application Decision: After the review, the underwriter will make a decision. If everything is in order, you proceed to the next stage of your application. If further clarification is needed, you may receive another request.
• Communication: Throughout this process, keeping an open line of communication with your Cleerly broker can help ensure a smooth experience. Don’t hesitate to ask questions if any part of the request is unclear.

By understanding these steps, you can better prepare to address any additional information requests efficiently, helping to streamline your application process.

With more than 20 years’ of contractor underwriting experience, Cleerly are experts in presenting contractors’ applications to meet the requirements of mortgage lenders and managing the process efficiently and effectively for our clients. Call the Cleerly team now on 02394 212 912.

Are there special lending criteria for locum medical professionals and supply teachers at Skipton Building Society?

Skipton Building Society  provides tailored lending criteria specifically for locum mortgages, medical professionals’ mortgages and supply teachers with over two years of experience.

Recognising the unique financial circumstances of these roles, they have implemented a flexible policy that does not require a minimum income. This flexibility extends to various types of medical professionals, including those engaged in nurse bank work.

In many cases, individuals in these professions lack a formal contract establishing a day rate, which can complicate mortgage applications. To streamline the process, Skipton Building Society ask for specific documentation:

• Invoices or Payslips: Submit invoices or payslips from the past three months. Skipton Building Society uses these figures to calculate an average, which helps in determining your financial capacity.
• Bank Statement: Provide your most recent bank statement to give a clear picture of your financial status.
• Current Contract: If available, include any existing contract that outlines your employment terms.

It's important to note that, like any mortgage application, the submitted documents undergo thorough review. If the underwriter deems any information insufficient, you might need to furnish additional documentation. This ensures all lending decisions are made on a well-informed basis.

Other Mortgage Lender Options for Contractors and Independent Professionals

Finding the right mortgage as an independent contractor or professional doesn’t have to be complicated. With options specifically designed for your unique work lifestyle, there’s a lender that can meet your needs. Here’s a closer look at the types of lenders available to you:

Building Societies

Building societies often cater to contractors with tailored mortgage products. They’re known for considering contract earnings rather than strict salary-based assessments, giving you added flexibility and terms that align with your financial reality.

Major Banks

Large banks understand the evolving work patterns of contractors and independent professionals. Many now offer contractor-friendly mortgage solutions, offering greater flexibility for those with irregular income streams while still maintaining competitive loan terms.

Specialist Lenders

These lenders focus exclusively on meeting the needs of contractors and self-employed individuals. They understand how your contracts reflect your income and use that understanding to provide tailored mortgage products that make the most of your financial profile.

Online Banks

If convenience and speed are priorities, online banks are worth exploring. These lenders have streamlined digital processes designed for busy professionals, often offering competitive mortgage rates and fast approvals without the need for face-to-face meetings.

Regional and Community Banks

Smaller, local banks bring a personal touch to the mortgage process. Their deep understanding of the local market combined with niche products often allows contractors to find highly customised solutions that suit their circumstances.

Options for Existing Homeowners Seeking Product Transfers

If you're an existing homeowner with a contractor mortgage looking to explore your options for a product transfer (mortgage ‘Product Transfer’ is when you switch to a new mortgage deal with your current lender; it's also known as a remortgage with your existing lender), you’re in luck.

You can initiate the process well before your current fixed term ends. Specifically, you have the flexibility to lock in a new product transfer up to four months ahead of your fixed rate's expiration with most major lenders (though this is subject to review and lender-specific).

While product transfers may be a suitable option for some clients, they aren't always the most competitive choice available. Where specialist brokers like Cleerly add value is in carefully assessing each client’s unique circumstances, which includes understanding any need for additional borrowing. This personalised approach often highlights that remortgaging to a new lender could be a more beneficial solution.

A thorough comparison of a client’s broader financial situation plays a crucial role in this decision. Factors such as property equity, loan-to-value ratios (LTVs), credit history, future property plans, associated costs, and eligibility for different products all need to be considered. For some, moving to a new lender with alternative rates or loan sizes might provide greater advantages, even if that involves affordability checks or additional legal fees.

Cleerly always aim to recommend the most appropriate solution. Building trusted, long-term relationships with clients is pivotal to ensuring satisfaction. By offering a clear, tailored recommendation that outlines the benefits of each option, brokers empower clients to make informed decisions. This approach is especially valuable in today’s shifting market, where securing a new deal ahead of potential changes is becoming increasingly important.

Why Consider a Product Transfer?

• Peace of mind: Securing a new product transfer early ensures you’re not suddenly hit with higher costs when your current term concludes.
• Flexibility: Adjust your mortgage terms to better fit your financial situation as it evolves.
• Cost-effectiveness: Often, there are no valuation fees or legal costs involved in transferring products compared to remortgaging with a different lender.

Steps to Initiate a Product Transfer with Cleerly

• Review Your Current Terms: Understand your existing mortgage deal to identify what you need in a new term.
• Contact Cleerly: Begin the conversation about your preferences and potential offers available to you.
• Assess the Options: Compare different products to see which aligns best with your financial goals.

By planning ahead, you ensure that your mortgage terms continue to work for you without unnecessary stress or expense.