01
Lenders with a genuine contractor policy
They calculate income as day rate multiplied by days worked per week, typically over 46 to 48 weeks a year, regardless of what you draw.
Residential
“I am a contractor on a day rate and lenders keep using the wrong income figure”
A number of lenders assess contractors on their day rate multiplied out over a working year, rather than on company accounts or drawn income. That usually produces a much higher borrowing figure than a standard self-employed assessment, but only with lenders who offer contractor terms.
An illustrative situation, not a client case study. It describes the kind of enquiry this market sees. Any figures are examples, not a quotation, and no credit check or lender decision is involved in reading this.
Sound familiar?
- You work through a limited company or an umbrella company on contracts
- Your day rate is good but your drawn income looks modest on paper
- Lenders have assessed you as self-employed and offered far less than expected
- You have gaps between contracts that lenders are treating as unemployment
The situation
Contracting is now common in IT, engineering, healthcare, construction and interim management, and the lending market has adapted — but unevenly. A contractor assessed on accounts and a contractor assessed on day rate can receive offers that differ by a factor of two.
The frustration is usually that the borrower knows their income is reliable, while the lender is reading a set of tax-efficient accounts that deliberately understate it.
Why the usual lenders say no
- Many lenders have no contractor policy at all and default to a self-employed assessment.
- Short contracts and gaps between them read as instability to a system built for permanent employment.
- Umbrella company payslips can be misread as low-paid employment.
What usually works
02
Evidencing continuity rather than permanence
A track record of contracts, ideally in the same field with renewals, addresses the stability question directly. Gaps are normal and most contractor lenders expect them.
03
Presenting the current contract correctly
The signed contract showing the rate, the term and any renewal history is the central document. Time remaining on the current contract matters to some lenders.
04
Choosing between contractor and self-employed assessment
Occasionally the accounts route produces the better figure, particularly for a long-established company with substantial retained profit. It is worth comparing both.
Roughly how the numbers look
| Typical calculation | Day rate × days per week × 46 to 48 weeks |
| Minimum contracting history | Varies; some lenders accept as little as 3 to 6 months |
| Contract term required | Some lenders want a minimum period remaining |
| Effect versus accounts basis | Frequently a much higher borrowing figure |
Contractor terms are a policy, not a product. The rates available are usually the lender’s standard rates, not a premium. These are examples to show the shape of a deal, not a quotation. Work out your own figures in the bridging calculator.
What we would need from you
- Your current signed contract showing the rate and term
- Previous contracts covering your contracting history
- Your CV or a summary of the roles held
- Three to six months of personal and business bank statements
- Company accounts if you have them, for comparison
- Proof of deposit and its source
Things that catch people out
- A contract about to expire without a renewal makes some lenders uncomfortable. Timing the application matters.
- IR35 status can come up. Have a clear answer on how your contracts are assessed.
- Do not let a lender assess you as self-employed by default — it is the single most common cause of an unnecessarily low offer.
Questions we get asked
How do lenders calculate contractor income?
Those with a contractor policy typically take the day rate, multiply by days worked per week and by 46 to 48 weeks a year. That figure is used regardless of what you draw from your company.
How long do I need to have been contracting?
It varies. Some lenders want two years, others accept as little as three to six months, particularly where you were previously employed in the same field. The variation is wide enough that a decline from one lender means little.
Do I pay a higher rate as a contractor?
Generally not. Contractor lending is usually a policy applied to the lender’s standard products rather than a separate, more expensive range.
The product that usually fits
See how it worksEvery case is different. A specialist will confirm what actually fits yours.
Keep reading
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Browse them allAmram Finance Ltd is a credit broker, not a lender. We do not lend our own money and we do not approve or issue loan offers.
Your property may be repossessed if you do not keep up repayments on a loan secured on it. Some forms of bridging finance and buy-to-let lending are not regulated by the Financial Conduct Authority.