Figures released this week by Halifax, the largest contractor-friendly lender in the UK, suggest that contractors who have a mortgage have the ability to achieve financial freedom quicker than those who are currently renting.
The figures are based upon the average contractor devoting their entire earnings so far this year towards their minimum mortgage payment. If the average contractor who were renting were to do the same towards their rent, it would take one month longer for them to achieve financial freedom from the ‘roof over the head’ cost for the year.
If you compare this to that of a contractor that rents, they would need to wait at least another month to achieve the equivalent of earning enough money to pay off their entire rent for a year.
As we have come to expect with these types of reports the data varies significantly depending on where in the UK you live. I am sure it will come as no surprise that buyers in the north reach their mortgage freedom day quicker with 7 out of the first 10 places being in Scotland and that at position 142 Swindon is the only southern place mentioned in the first 150 places ordered in how quick mortgage freedom day could be achieved.
Nationally, there is only a few days difference between the earliest dates, as this year\'s Mortgage Freedom day occurred in Northern Ireland on the 16th March and in Scotland on the 21st March. For those contractors who live in England, the average freedom date however didn’t take place until yesterday the 16th April.
Steven Clements, Senior Mortgage Consultant at Contractor Mortgages Made Easy commented “As with any report of this nature the data can be a little subjective however it does once again highlight the different financial implications of buying over renting.”
“If you rent your home, then every year, on average, you will need to do about a month’s extra work to cover the cost of renting compared to a mortgage. Therefore as a homeowner you could use the extra money to clear your mortgage even quicker or have the freedom to use the money for something more pleasurable”
Article by: Taj Kang, Operations Director at Contractor Mortgages Made Easy
Media Contact: Raman Kaur, Public Relations Manager
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