What is a CIS mortgage?
CIS stands for construction industry scheme which allows sole traders to represent their income in an accurate way to mortgage providers. A CIS mortgage is a type of mortgage where the borrower’s income is used to calculate the loan amount. This means that the lender will only lend up to the maximum amount they think you could earn over the course of the loan term.
How to apply for a CIS mortgage?
At needingadvice.co.uk ltd we have specialists who are experienced in applying for CIS mortgages. We have a range of mortgage lenders across the UK who can provide you with the most suitable deal on your application. Most of the mortgage lenders will ask for at least 12 months of the payslips and bank statements, so it’s better to collect all your previous CIS payslips before starting your application.
How much can I borrow?
As long as you meet the lending criteria set out by the lender, the amount of money you can borrow depends entirely on what you are able to prove about your ability to repay the loan. As a general rule, the higher your monthly income, the more you can borrow. However, there are some exceptions to this rule. For example, if you have had a large increase in your income recently, you may be able to borrow more than usual.
Is it harder to get a mortgage as a contractor?
Self-employed mortgages can be more complicated because of the variable monthly payment. If you don’t know exactly how much you’re going to make each month, then you’ll need to show your lender how you intend to pay off the debt. They might also want to see evidence of your business expenses, like rent and rates. If you are getting a self-employed income, you may need to contact an expert mortgage broker to start your mortgage application, otherwise, your application may get rejected which will affect your future borrowings and credit score. Read more about self-employed mortgages at our website.
Can I get a CIS mortgage with bad credit?
A bad credit score always affects the mortgage application, so if you are applying for the CIS scheme mortgage, you may need to face some complications. Some lenders could approve your CIS mortgage with your poor credit history and some may ask for your annual income to check your affordability. You should try to improve your credit rating first and then apply for a new CIS mortgage. It is always better to contact a specialist mortgage broker for advice on CIS loans. You can also read more details in the article What is CIS Scheme mortgage?
Which lenders offer mortgages for CIS workers?
It is hard for a mainstream lender to accept annual income as proof made through CIS transfers during the affordability check. If you registered in the CIS scheme, it’s better to contact a specialist mortgage broker. CIS Mortgage brokers know what lenders tend to approve or reject based on the information provided by the CIS. They also know how to get around the system. You should consider speaking with them about your application.
Can you get a CIS mortgage if you’re paid on a day-rate basis?
Yes, an individual could get a CIS mortgage if paid on a daily rate basis.
For the purposes of applying for a mortgage through the CIS, the most important thing is producing enough evidence of the payslips vouchers you’ve received so a mortgage lender can work out your average gross annual income.
If you are interested in applying for a CIS mortgage, it’s important to produce enough monthly payslips or vouchers as monthly payment proof or annual income for your affordability assessment.
Are there CIS mortgages for Subcontractors with bad credit?
Yes, it’s complicated but a subcontractor could get a mortgage with bad credit history. It is always better to contact a mortgage broker before starting your application.
