Company Director
Mortgages

All banks offer mortgages, but how beneficial they are depends on your situation. If a bank only considers salary and dividends, but you haven’t drawn any and instead have a high net profit, that approach won’t work in your favour—it could reduce the income available for assessment.

This is especially relevant for contractors operating through a limited company. Many aim to minimise tax liability by offsetting expenses, which can result in a lower net profit despite having a high contract value. That’s why the contractor mortgage route may often be more suitable than the standard limited company approach.

The minimum trading period required is one year—you must have at least one set of accounts. No lender will consider an application with less than a year of trading history.

However, the situation is different for contractors. Depending on your experience, you could secure a mortgage from day one. If you’ve moved directly from an employed role to contracting, even through a limited company, lenders can be much more flexible.

While one year of trading is the minimum, having two years of accounts significantly broadens your options, giving access to most lenders. With three or more years of trading and strong profits, you can access the full market, including the possibility of a 100% mortgage if it aligns with lender criteria.

Many people are surprised that 100% mortgages still exist. However, ideally, you should aim to put down at least a 5% deposit, as a larger deposit opens up more choices and secures better interest rates.

It’s also important to consider the type of property you’re buying. If you’re purchasing a new-build apartment, you may need a slightly larger deposit, even if you qualify for a mortgage under the limited company route.

Beyond that, standard affordability rules apply. Some lenders impose borrowing caps, which can influence lender selection. Credit history also plays a role, but minor credit issues aren’t necessarily a barrier. Many high street lenders are willing to overlook older credit blips, particularly if they occurred over two years ago. Even more recent, minor issues—such as an occasional missed payment—may not be a dealbreaker.

If needed, specialist lenders are an option, but you’d be surprised how many mainstream banks are open to applicants with some credit history challenges.

Many assume that being a limited company director means banks will increase interest rates or impose property restrictions, but that’s not the case. Banks simply have criteria—you just need to meet the right requirements.

For example, if you’re looking to buy a listed property, a non-standard build, or an eco-home with unique features like a grass-covered roof, you’d need to find a lender comfortable with that type of property.