Saffron Building Society are one of the recent mortgage lenders to offer contractor friendly underwriting, after launching a new product range which caters for contractors in March 2013. The new product range is available only through mortgage brokers, and borrowers are currently unable to apply through the Building Society directly.
Whilst some lenders will only offer bespoke underwriting for contractors within the IT sector, Saffron Building Society are far more flexible towards the industry that the contractor works within, and will accommodate contractors across all sectors.
In order for an individual to meet criteria for flexible underwriting, they must be able to demonstrate a contracting history over a minimum period of six months. In addition, at point of application, the current contract must have an unexpired term of six months or longer. If the individual meets this criteria, income can be defined based on annualised contract rate, maximising borrowing capacity.
Although this lender can be a great option to those who work within industries which are generally less favoured by other mortgage lenders, the rates offered by this lender are in most cases significantly higher than those offered by other contractor-friendly banks and building societies.
At CMME we will consider Saffron only in cases where the contractor works in a less commonly accepted sector. For most, the larger and more traditional supporters of bespoke underwriting tend to offer more competitive rates and are usually less stringent in terms of minimum contracting history and unexpired contract term. In short, although Saffron are becoming more open to borrowers with more complex income structures, particularly where occupation is concerned, the products offered by this lender are not usually among the most competitive in this marketplace.
With this particular lender they fill a gap when there is no other choice as, subject to affordability, one lending option can sometimes be better than none at all.