Top Tips For Securing Your Contractor Mortgage

Getting a mortgage can be slightly trickier for contractors than for permanent employees, so having a good contractor mortgage lender could mean the difference between you getting your dream home and unnecessarily lengthy processes and paperwork causing it to slip away.

The traditional criteria that most mortgage lenders use to assess applications is not suitable for the contracting lifestyle, and as such often results in a large number of contractors being declined for mortgages which they are more than capable of repaying. This sparked the birth of the ever-popular contractor mortgages, which foster much more realistic application criteria, as well as the ability to offer competitive rates.

Unlike traditional banks and building societies that base the maximum they are willing to lend on salary alone and are wary of the short-term nature of contracts, contractor friendly lenders are much more flexible.

For most people a house is the biggest purchase they are ever likely to make so choosing the right mortgage lender is vital. Here are 5 top tips to bear in mind when choosing your lender:

1)       Beware of tie-ins. Many mortgage lenders will try and entice you to sign up to their deal with tempting short term rates. However, once you have signed up you end up staying with them long term even though they dramatically increase their rates after the initial deal period ends.

2)       Compulsory insurance clauses. Some mortgage lenders will insist that when you take out a mortgage with them you must also opt in to pay for their additional services. These add-ons such as home insurance and unemployment cover are rarely value for money and can mean that in the long run your chosen mortgage might not work out the cheapest.

3)       Rate of processing. Buying a house can be a lengthy process. However, some lenders are known for moving quicker than others and therefore those with time constraints may choose to go for a slightly less favourable rate for a quickly processed application in order to secure their home. Specialist contractor mortgage providers can often help if you need to progress quickly as they are better placed to understand your situation from the offset.

4)       Buy-to-let mortgages. If you are hoping to secure a property that you intend to let out it should be declared as a buy-to-let mortgage. Although it should be declared, the fact that you will be not living in the property yourself, but letting it out, should not make a difference to your lender – the rates offered should be similar to normal residential rates and there should be no large admin fees for you to pay on top.

5)       Mortgage indemnity insurance premiums. You are only likely to come across mortgage indemnity insurance premiums if your deposit is less than 5% or in other rare cases. They are designed to help protect the lender in the event that you should experience negative equity. This benefits the lender but you will still be liable for the money that the insurer has given to the lender and there will be a premium to pay on top as well.

Please visit ContractorUK for more contractor mortgages information.

About the Author:

Many thanks to Laura Foster for this post.  Laura writes for ContractorUK on various topical issues surrounding the contracting market including new and existing legislations, jobs, interviews, training, money and service providers.

 

How To Retain Clients As A Contractor

You’ve found the perfect client.  You enjoy the work, you communicate well and they’re reliable payers.  Your existing customers could well be the foundation of a thriving business so it feels crucial that they keep coming back to you. When you’re good at what you do, returning customers are generally more profitable than new ones and it’s definitely easier to get business from them than to go out scouting for new business.  Here are some tips and incentives on how to retain clients as a contractor.

If they’re a valued customer, make sure they feel like one.

It might seem obvious but it’s surprising how many businesses take their existing clients for granted and loyalty to a supplier only goes so far when everyone is fighting for a contract.  It’s important not to pander to your new or prospective clients so much that you forget your best clients. Returning customers have given you more work than anyone and may have even referred you to others so put them first.  Offer them exclusive offers or services to show that you value their business. Make sure you also take note of important dates.  The personal touch goes a long way to securing customer satisfaction and loyalty.  Just remembering and making reference to conversations you had with them last month can make a big difference, as can a personal message on the company’s anniversary or a key contact’s birthday.

Create special promotions for existing clients

If you want a client to keep returning to you it makes sense to reward them when they do.  Traditionally most businesses have a couple of sales a year so why shouldn’t you?  It’ll be seen as a way of saying ‘thank you’ to those existing customers.  Perhaps basing a ‘sale’ or reduced price period around an event would work well, for example, a summer sale or a birthday promo, especially if you know there’s a lull in work at specific times of the year.

Make the effort to stay in touch

A client may not always have work for you but that doesn’t mean you should sacrifice the relationship during quiet periods. Make the effort to touch base with them every now and then to see how they are getting on.  Clearly they won’t want to be bombarded with marketing , but a personal email or phone call every so often will make them less likely to start shopping around.  Keeping in touch with any important news associated with the industry can be a great way to create discussion with a company and to show you genuinely understand them and what has an impact on their business.

Create something just for them

You could create your own personal newsletter to send out to an email list of existing clients (with their permission), an update on any ‘special offers’ (see above) or hints and tips about your industry and any other news that may be relevant to them.  Some freelancers provide an information package when they win a new client so that they have relevant contact details, pricing and process information to hand when they need it.

Of course, keeping the business ‘hopper’ full also relies on new business so our next blog will feature some tips for winning business and some of the top websites for finding those new contracts that could lead to valued, long term clients.

If you have any other ideas to share, please add them in the comments below.

June Contractor News Round Up

Your monthly round-up of June’s top contractor news.

 

Kingsbridge Professional Solutions launch a new BIBA scheme

KPSol have just launched professional indemnity scheme for freelance professionals with BIBA (British Insurance Brokers’ Association).

The scheme has been designed to allow other brokers access to a policy, specifically designed for freelancers and contractors or those who are working as sole traders.  It’s available exclusively to BIBA members.

With freelancing being the fastest growing sector of workers, (over 1.56 million working in 2012) the scheme caters specifically for their business needs and is available at an extremely competitive price.    Brokers can benefit from our experience in this rapidly growing sector and get access to a scheme which provides comprehensive cover and peace of mind for their client.  A white label solution is also available.  Visit our website for more details.

Boom in youth self employment

Britain is likely to see a boom in self-employment amongst the young workforce; currently only about 5% of the young population are already self-employed. This is all according to a report from the Prince’s Trust that shows a sizeable number of young adults aspire to follow that 5% into self-employment. A quarter of those surveyed said that with the job market becoming ever more competitive, they would rather work for themselves than search exhaustively for more traditional ‘employee’ role.

High youth unemployment rates between the ages of 16-30 are the reason behind the spike in young self-employed professionals.  Many are drawn to the appeal of self-employment because of the freedom that can accompany it especially as, with the development of on-line technology, work can be much more portable.   46% of young adults predicted that it will soon be possible to work at any location on the planet.

The research reveals an upturn in entrepreneurial moods from young adults and more and more are seeing self-employment as a way to break the cycle of joblessness.

Zero-hours contract workers earn £6 an hour less than colleagues

Another survey this month has revealed that contract workers on 0 hour contracts can earn up to £6 an hour less than colleagues.

Employers have been shown to exploit the flexible arrangements of contractors by paying them low wages, some employees on 0 hour contracts were paid £6 per hour less than those with set hours. The resolution foundation has warned the government that increasing implementation of these 0 hour contracts across public and private sectors is undermining basic employment rights and hitting younger workers especially hard.

Vince Cable has refused to ban the practice, but has hinted he may be willing to fight for stronger protections if employers are found to be abusing the system. The contracts mean that employers can adjust staff hours week to week with no set minimum wage for the week.

It was also admitted by The Resolution Foundation “…that the benefits these contracts provide for employers come at too high a price for the majority of those employed on them.”

Are you noticing an increase in young contractors and freelancers or have you lost out by signing a zero hours contract?  Tell us about your experiences by leaving a comment below.

 

 

Meet The Kingsbridge Team – Lauren Costello, Client Services Advisor

As promised, here’s the next installment in our ‘meet the Kingsbridge team’ series.  Our next victim participant is Lauren Costello, champion show-jumper and future zoo keeper.  Thanks for taking part Lauren.

Name: Lauren Costellolauren

Role:Client Services Advisor

How long have you been working with KPSOL?

Since November 2011

What does your job role include?

I speak with at least 50 people a day on the phone as well as responding to email enquiries.  Most of the conversations I have are with freelancers and contractors who are interested in the KPSol insurance package and either want to put a policy in place or have questions about the cover levels and whether it’s the right policy for them.

I also work with some of our business partners.   Often accountancy firms are keen to ensure their contractor and freelancer clients have the necessary insurance in place and many recruitment agencies insist on it before they’ll add them as candidates.  KPSol works closely with them to help them provide an end to end service.

What did you want to be when you were younger?

A famous show jumper, a vet or a zoo owner (I’d actually still like to own a zoo)

What do you enjoy most about your job?

Making a difference for a client is important to me and when I can do that I get a real buzz.  I also count myself as lucky to work with some brilliant people so just being in the office is enjoyable, even if I’m having a tough day.  We have a lot of fun.

What has been the highlight of your career?

Last year I went to the Gastech exhibition at ExCel in London.  One of our specialisations is in providing cover for Oil and Gas professionals and this is a huge, global event for the industry.  It hadn’t been held in the UK for 40 years (it’s in South Korea next year!) so I was really lucky to be able to attend and meet so many people in the industry.

What is your favourite thing about the company and what makes them different to work for?

The company has grown quickly over the last few years and it’s given opportunities to and invested in a young team (myself included) and it continues to do that.  Although traditionally the Client Services team would probably be referred to as a call centre, we’re encouraged not to be robotic, to build a real rapport with our clients.  We’re involved in planning and agreeing processes and we have regular communication from senior management around strategy and developments in the business.

What do you enjoy outside of work?

Horse riding and watching the rugby.  I’m also a cinema addict!

Tell us an interesting fact about yourself

When I was younger I won the regional Jump Cross event on my horse, it’s a mixture between show jumping and cross country.  I was also on a TV show with Eddie Izzard once, I can’t remember it though!

Any advice you could give to someone looking to get a job in a similar environment?

You need to be very proactive.  Although most of the enquiries the Client Services team deals with are inbound, we still have to actively build relationships with our clients and make sure we’re answering their questions quickly and accurately.  You need to have a passion for customer services and also a willingness to learn and develop a good understanding of your clients’ needs and the insurance industry in general.  It’s hard work, but really satisfying.

What do you think makes Kingsbridge stand out from other insurance providers?

We’re often able to cover people who haven’t been able to get insurance elsewhere, or who thought they would have to pay thousands to get cover.  The set package of insurance is designed so our clients have peace of mind that they have the right cover, without the time and confusion they can experience from sourcing separate policies from multiple providers.

Any advice you have for freelancers or contractors looking for insurance?  

It’s vital that you’re adequately protected and equally, that you’re protecting anyone who might be affected by the work you do.  Don’t assume that you are automatically covered by your agency, your accountant or your professional body.  This is not always the case and we have so many contractors getting in touch, panicking as they won’t get paid until they can provide proof of insurance.

 Where do you hope to be in a few years’ time?

The plan is to get more involved with the work that the team that manage our partnerships and affiliations do.  I’m training with them at the moment, working towards a role as an account manager. 

We’ll be featuring more Client Services profiles over the coming months.  If you need to talk to a member of the team for a business insurance quote you can call on             01242 808740 or send an email to enquiries@kpsol.co.uk.

 

Time Management Tools For Freelancers And Contractors

Time management tools are very useful for contractors and freelancers. Not just for your client so they can see where the hours have been put in, but also for yourself. Using a tool like this allows you to track your work if you charge by an hourly rate, but also should help you keep your productivity up. The feeling that something is watching over your work makes for time well spent.  Many of these tools are also available across mobile and tablet devices, so useful if you’re working out of office.

So with that in mind we thought we’d give you the low down on some of the best time tracking tools out there.

Toggltoggl

Toggl is a great and esay to use tool, which you simply stop and start when you begin and end work. It can massively aid in productivity and it’s fun to use. The basic version is free, to gain access to more tools and features there is a fee of only $5 per month.

Yanamo Yanomo

Yanamo is particularly useful if you’re working in a team. It syncs with your Google calendar, tracks your time and you can share updates with team members. It does come at a price, but you can try the free trial for 47 days!

TSheets TSheets

TSheets is paid software but it’s probably money well spent if you want to track manage and report your time. Especially useful if you have clients that are strict about where your hours have gone. It’s easy to use and has a clean interface. There’s a 14 day trial if you want to test it out.

Get Harvestharvest

Harvest is a time tracking, reporting and invoicing app and desktop tool. It is available at 3 different price plans, but the basic plan is all you’ll need as a solo freelancer. With a simple intuitive interface, this is a handy tool for your daily timekeeping.

 SlimTimer SlimTimer

SlimTimer is a very simple to use time tracking tool which can also run reports which you can export. To track time you simply name a task, click on it and click again to stop. You can also sign up for free!

So those are 5 of the best time tracking tools we’ve found, do you have any other recommendations? Let us know below.

Top Freelancing Tips To Help You Balance Your Lifestyle

Let’s face it,  maintaining the elusive work/life balance is a challenge for many professionals.  Those in permanent employment at least get to leave the office, switch on an out of office or take a break while a colleague keeps on top of any vital tasks.  All of which might seem like an unobtainable luxury to those who don’t have the safety net of an employer to rely on.

That doesn’t mean that you can’t freelance or contract while maintaining a personal life too.  We spoke with some of our clients and they all told us that, no matter how much they enjoy their work, reserving some time for themselves, friends and family is vital.  So, we’ve come up with our top Freelancing tips to help you balance your work and your lifestyle.

Don’t believe in ‘once in a lifetime’ opportunities

Thinking you have to put something personal off or on hold because the work offer you just got is a ‘one time thing’, isn’t the best idea. Most of the time ‘unique’ opportunities will be presenting themselves more than once.

Few larger Jobs are better than lots of smaller ones

When you are taking on jobs, think about taking that large paying job rather than taking on a number of small jobs, it will benefit you in the long term and save you a lot of stress. They may be worth the same amount of money, but the focus on one project will save you the aggravation

Set appointments, don’t be on call

One of the top tips when creating a work/life balance is keep your phone in check, set hours to answer emails and phone calls in, and don’t waver from your schedule.  If you waiver even once, it could upset your schedule and therefore interrupt your social life.

Maintain Core Work Hours

Again, set up your schedule of work hours and stick to it. It is ideal to be working around 9-5 as that is when everyone else will be available on call and email. If something comes up, agree realistic working hours with the client and leave yourself enough time to rest and relax away from work.

Shut the Door

If you work from home, make sure you are away from distractions and in your own space. The best way to do this is to simply shut your office door. Keep this procedure in place and it should help keep you in a work mind set.

Maintain good client relationships

Keep in contact with clients during a job and make sure to send follow up emails to check they are happy with work. A simple follow up will be appreciated; don’t start emailing every day, hassling them for more work!

Replace some work goals with personal goals

If your work goals take priority over your life it’ll begin to take a toll on your mental well-being. Take some time to set some personal goals to achieve instead of focusing on just work-based ones. Some ideas could be, setting a goal of going to the gym a certain number of times a week or starting a new hobby.

Don’t forget you are your own boss

This is important, don’t forget it! The fact you are your own boss means you have the freedom to dictate what you do. If you don’t think you can meet that deadline, tell the client and figure out a new plan. If you feel like you need some time off, figure out a plan around your work and do it. If you woke up and you don’t quite feel up to working, go back to bed make sure you get the rest and let your clients know you’ll be a day behind. You have the freedom to do what is best for you, use it.

Do one thing at a time

Finally, although multi-tasking may feel like you’re getting a lot done, a lot of the time it is just spinning wheels. Multi-tasking can often lead to mistakes and extra stress in your work. The best way to keep you from falling into this trap is to make a list of all your tasks and finish each one before moving on.

We’d love to hear from you if you have any tips or advice of your own so please feel free to add a comment below.

 

May Contractor News Round Up

Your monthly round-up of May’s top contractor news.

There are so many information sites for Freelancers and Contractors (see our Top 10 sites for freelance and contractor news post) and sometimes there just aren’t enough hours in the day to stay up to date with the latest news.  So, we thought you might appreciate a monthly roundup from some of our favourite sites.

Youth entrepreneurship is soaring:

New figures have shown, that despite what people may think or say about the youth of Britain, that many are trying to become productive members of society by going down the entrepreneurial route. Many are taking the option to become self-employed instead of waiting for the right job to be available for them.

The stats were found in a YouGov study, with 30% of those questioned saying that they would be self-employed in the future, whilst a quarter said they’d be their own boss within five years. If these young people followed through on their plans, then it would see an increase in 5% on top of those young workers who are currently self-employed.

Since 2008 the amount of young self-employed has risen by 71,000. This is obviously due to the lack of employment options for graduates. So it does make sense for them to try working for themselves which can only be good news for the economy

Umbrella companies are suffering from low usage from freelancers

According to new stats, only 15% of freelance workers are using payroll umbrella companies. There are thought to be around 1.6 million professional freelancers in the UK and so this new statistic means there are over 1.35 million who are not using an umbrella company to help them manage their earnings.

Main issues people had when surveyed were the costs associated when using an umbrella company and misunderstandings over the role and benefits from these types of companies.

Phil McDonald the Managing Director of Paraplus, who conducted the survey said, “These findings should be a wake-up call for the umbrella industry. It makes for tough reading that 26.5% of freelancers don’t understand exactly what an umbrella company does and 14.5% don’t even know that one could help them.”

Will the self-employed be re-categorised as employees?

The taxman now says that there are two situations in which individual LLP members will next year be treated as if they were employees and therefore liable to pay income tax.

There are two situations in which, from April 2014, LLP members will be treated as if they were employees of the LLP, who will then have to operate PAYE on payments to the member.

These are the two situations:

  • On the assumption that the LLP is carried on as a partnership by two or more members of the LLP, the individual would be regarded as employed by the partnership by reference to the normal tests of employment.  These deal with matters such as control, the requirement for personal service, financial risk, the ability to profit from sound management, and so on. In some cases it will be plain that the terms on which the “salaried member” is engaged are indistinguishable from employment: in others (especially in ‘eat what you kill’ partnerships) it may be very easy to show that relationship is not one of employment.
  • Alternatively, HMRC proposes to treat a salaried member as an employee if he or she is not an employee under the first test but is nonetheless someone who:

– Has no significant economic risk (loss of capital or repayment of drawings) in the event that the LLP makes a loss or is wound up;

– Is not entitled to a significant share of the profits beyond the “fixed share”; and

– Is not entitled to any significant share of surplus assets arising on any winding-up of the LLP

That’s our May round-up of Freelancing news. If you have any comments or questions, leave a post below.  We’d also love to hear from you if you have any other sites to reccommend or regular features you’d be interested in reading.

Meet The Kingsbridge Team: Liam Green, Senior Client Services Advisor

Our customers are at the heart of everything we do.  We’re proud of our Client Services team which has doubled in numbers over the last six months and we thought our blog readers would like to meet them.  Meet the Kingsbridge Team is a new series on the blog – over the next few months I’ll be introducing the team, starting with Liam Green, Senior Client Services Advisor, rugby captain and champion apple bobber!  The rest of the KPSol team are also looking forward to finding out some embarrassing interesting facts about each other!

NameLiam Green

Role:  Senior Client Services Advisor

How long have you been working with KPSol? 

Three years now and it’s flown by. The team is much larger than it was when I first started as an advisor.  I was new to the insurance industry but now I can’t see myself doing anything else.  I’ve completed five training courses in that time and I’m a member of the CII (Chartered Insurance Institute) and have a Cert CII accreditation.  I’ve also gained two qualifications from the ILM (Institute of Leadership and Management).

What did you want to be when you were younger? 

A fireman or a professional rugby player.  The rugby passion has never gone away and although I’m far from a professional, I do play regularly.

Can you tell me a random or interesting fact about yourself?

I’ve been the first team rugby captain for my local team, Evesham RFC for the last two years and have just accepted the captaincy for a third year.  Rugby has always been important to me (have I already said that?) and it’s a privilege to captain my team.

How do you think your colleagues and/or friends would describe you in three words? 

Hardworking, fun and fair.

What do you like most about your role? 

Definitely speaking to our clients: Each person is so different and can often throw up some very interesting conversations!  I also get a lot of satisfaction when I’ve been able to offer advice and get insurance cover for someone who’s really struggled with other providers.

What has been the highlight of your career so far?

It’s a close call between renewing a client while his wife was giving birth in the same room or being the ‘top apple bobber’ in KPSol last Halloween!

What do you think makes Kingsbridge Professional Solutions stand out from other insurance providers? 

I think it’s our dedication to a very specific group of people.  Freelance and contractor professionals make up a significant percentage of the UK’s workforce and have really specific needs when it comes to insurance.  The policy we provide is designed for them which means our pricing and cover levels are very competitive.  We understand the freelance and contractor marketplace and the challenges they face as a group but we also maintain a very personal touch which means we can provide advice and appropriate cover for individuals too.

Do you have any advice for readers considering taking out freelance or contractor insurance?

Don’t be fooled into thinking that you don’t need insurance! Nearly all contractors will need some form of insurance, whether it’s to settle contractual obligations or to cover the work they carry out or any members of the public who might be affected by their activities.

 

We’ll be featuring more Client Services profiles over the coming months.  If you need to talk to a member of the team for a business insurance quote you can call on 01242 808740 or send an email to enquiries@kpsol.co.uk.

Top 10 Sites For Freelancer And Contractor News

It can be hard to keep up with what feels like ever changing regulations and best practices for freelancers and contractors – if you’re looking to keep up to date with the latest news in the freelance contractor industry take a look at our top 10 sites for freelancer and contractor news:

Freelance Advisor

Articles include comments on current news affairs which can affect freelancers, financial and freelance lifestyle advice. We’d recommend checking out the weekly digest posts, which link to interesting and useful sites.

Brookson

The Brookson Accountants site includes financial news and advice, industry specific blog updates (including Medical, Construction and Oil and Gas). There are also some handy downloadable guides available.

Freelancing Matters

Great magazine for contractors and freelancers to keep up with industry news, circulated by the PCG and with regular insight posts from contributors.

Contractor Weekly

Up to date news for contractors including IR25, tax and business news. There is also a job board and guides to contracting, mortgages and rates.

Contractor UK

Predominantly for the IT contracting community but with regular articles relevant to other sectors. Article categories include financial and legal.

Contracting ME

Contracting Made Easy site includes guides to contractor regulations, expenses, insurance and finance for umbrella and limited companies as well as first time contractors.

Contractor Calculator

Regular updates on the contractor market including statistics, legal and contractor umbrella company news.

Guerrilla Freelancing

Something different with tips and advice for the freelance community – including how to build your freelance business, marketing and financial tips.

Financial Times

Keep an eye on company news, tax and legislation changes. There are also sections for specific industries including Oil and Gas and IT.

Shout99

Regularly updated with news and support for freelancers and small businesses.  It’s worth signing up the newsletter for alerts – a panel of experts frequently answer legal and accounting questions with valuable insights into the industry.

 

Useful Apps For Freelancers And Contractors

Apparently, there’s an app for everything!  The increasing number of business and communication based applications that are now available are certainly testament to how we operate commercially.  We’ve selected some of what we think are the most useful apps for freelancers and contractors.

Communication

Google HangoutsFree international voice and video calls with up to 15 people; great for webinars, industry chats or meetings. Paid business account upgrades are available.

Skype – Free online video or voice calls with options for cheap rates to international numbers. Voice and video are also available with up to 10 people.

Money

Project Quote estimateA tool which helps create .PDF estimates (particularly for construction)

Quick books – Manage sales, estimates, invoices and receipts easily on your mobile or desktop.

Invoice2go Create, manage and send invoices on your phone or desktop. There are various custom invoice designs available and even an option to share them with your accountant. A free trial is available.

Organisation

HarvestTrack your time spent on projects, useful app for time management or if you charge per hour.

BasecampProject management. Basecamp allows you to upload and update documents, files and events, to which you can add other people to create discussions.  This is a  really handy tool for keeping everyone updated and managing everything from the same place..

EvernoteWrite and share notes, manage appointments and collate research.  We think this is an invaluable tool for all professionals.

With an average of 701 apps launched every day during 2013 the next best seller could well have been released while this post was being written.  We’d love to hear your suggestions via the comments box if you’ve found anything we’ve missed.