IR35 Mortgage Advice: Why Lender Criteria Make Specialist Help Essential
- Conrad Nolan
- Aug 11
- 3 min read
If you’re looking for IR35 mortgage advice as a contractor or freelancer, you already know that securing a mortgage isn’t always straightforward. Lenders rarely treat complex incomes the same way they do a standard salary. Your IR35 status and how your day rate is calculated can make a huge difference to what you can borrow—and to your experience of the whole process.
Many contractors find themselves turned away by mainstream lenders or offered far less than expected, simply because their income doesn’t fit the usual boxes. That’s where specialist knowledge becomes invaluable.
How Lenders Assess Contractor Income: £500 Day Rate Example
Let’s say you’re a contractor earning £500 a day, working five days a week. You might assume your income would be assessed the same way by any lender—but that’s rarely the case. Understanding how lenders assess your income is a key part of effective IR35 mortgage advice. Here’s how some major lenders might calculate your annual income:
Some will take your day rate, multiply by the number of days you work per week and by the number of weeks in a year, then use only a percentage (such as 80%) of this figure as your annual income.
Others might look at a reduced number of working weeks per year—such as 41 or 46 weeks—regardless of your actual contract length.
That’s a difference of up to £12,500 in annual income—just based on which lender you approach.
Now, most lenders will offer up to 4.75 times your assessed annual income as a maximum mortgage. So, choosing the wrong lender could mean nearly £60,000 less borrowing power—enough to put that dream home, or a major home improvement like a garden office, out of reach.
Why Lender Criteria Changes—And Why Specialist Advice Matters
Lender criteria doesn't just differ—it changes over time. What works today might not work tomorrow. Policies on IR35, contract length, acceptable gaps, and more are regularly updated. These changes aren’t always widely published, and even small differences can have a big impact on your borrowing power.
Why IR35 Mortgage Advice Matters for Contractors.
Because I specialise in complex incomes, I keep up-to-date with these shifts and know which lenders are flexible, which are strict, and how to present your finances for the best possible outcome. Trying to navigate this alone can mean missing out on thousands of pounds of borrowing potential, higher interest rates—or being rejected entirely.
Real-World Example: Unlocking Additional Borrowing for a Garden Home Office
Recently, I worked with a contractor who’d been told by their bank that they couldn’t borrow any additional money to fund a home office in their garden—a common improvement for remote and hybrid workers. Frustrated and ready to give up on their plans, they came to me for a second opinion.
By carefully reviewing their contract income and matching them with a lender that takes a more favourable approach to contractor earnings, I was able to secure the extra borrowing they needed. The result? They not only got the green light for their garden office, but also benefited from a smooth, jargon-free process with all the paperwork and negotiations handled for them.
This kind of outcome isn’t unusual—especially for contractors and freelancers who want to maximise their borrowing for home improvements, extensions, or those increasingly popular garden offices.
Don’t Leave Your Mortgage Outcome to Chance
If you’re a contractor, freelancer, or anyone with a complex income looking to fund home improvements or secure additional borrowing, don’t leave your mortgage outcome to chance. Specialist advice can help you unlock your real borrowing power—and make your home office dreams a reality.
Ready to see what’s possible for you? Contact Conrad FS for tailored IR35 mortgage advice today.
Get in touch for a personal, jargon-free consultation—tailored to your circumstances.
Learn more about protection insurance for contractors
Comments