A stuttering job market, cost-of-living crisis, and unpredictable economy have made contractors increasingly anxious about their mortgage prospects. Rising interest rates have compounded these difficulties, creating a formidable financial landscape for contractors seeking home loans.
However, with inflation dropping to 2.3% in April, is there good news on the horizon for contractors looking to secure or remortgage?
Base Interest Rate Static Since August 2023
The Bank of England's base interest rate is 5.25%, a 16-year high that has remained static since August 2023.
Hopefully, for contractors, the falling rate of inflation has prompted talk of a base rate reduction. According to Rightmove mortgage expert Matt Smith, the drop in inflation “feels like an important milestone on the road to the first Base Rate cut.” Smith added that the news “will likely reinforce some of the positive words coming from the Bank of England in recent days. Mortgage rates are still higher than this time last year, but hopefully this is the first domino to fall as we head towards lower mortgage rates in the second half of the year.”
High Base Interest Rate has Significantly Impacted Mortgage Rates
The high base rate has significantly impacted mortgage rates, making borrowing more expensive and lending criteria stricter. For contractors, this has made for grim reading. But with a potential rate cut this summer, there is some hope.
At Champion Contractors, we partner with Cleerly Limited, a specialist independent and regulated mortgage advisor.
Cleerly is a mortgage advisory business with expertise in supporting contractors, freelancers, and self-employed professionals throughout their mortgage journey. With an Excellent, 4.9 rating on Trustpilot, Cleerly is FCA authorised and regulated and provides access and guidance on a wide range of products and services tailored to individual contractors' mortgage needs.
For further assistance and advice on securing the best mortgage deals available to contractors, visit our website at https://www.champion-contractors.co.uk/ or follow us on LinkedIn.
Alternatively, contact the Champion Contractors team on 0161 703 2549 or email info@championcontractors.co.uk.