Farnborough has the highest concentration of day rate contractors in Hampshire. QinetiQ alone employs thousands of contractors across its GU11 and GU14 sites. BAE Systems, DSTL, TAG Aviation, MBDA and the wider aerospace and defence supply chain add thousands more. These are skilled professionals earning 400 to 800 pounds per day — and the majority of them have been offered mortgages that bear no relationship to their actual earning power.
The reason is straightforward. A contractor operating through a limited company typically pays themselves a low salary — often 12,000 to 30,000 pounds — and takes the rest as dividends or retains profit in the company. A high street bank looks at the payslip, sees 28,000 pounds, and offers a mortgage of around 126,000 to 140,000 pounds. The contractor they are advising earns 550 pounds per day.
How Day Rate Assessment Works
Specialist contractor lenders use a different methodology. They take your contracted daily rate, multiply it by 46 working weeks — the standard industry benchmark for sustainable annual contractor income — and use the resulting figure as the basis for affordability assessment. A 550 pounds per day contract produces an assessed income of 126,500 pounds. At 4.5x income that supports a mortgage of 569,250 pounds. At 5x, it is 632,500 pounds.
| Assessment Method | Example: 550/day contractor |
|---|---|
| High street bank (payslip salary) | 28,000 salary → mortgage of ~£126,000 |
| Specialist lender (day rate annualised) | 550 x 46 weeks = £126,500 income → mortgage up to £632,000 |
| Difference | Up to £506,000 more borrowing |
A QinetiQ contractor on 600 pounds per day was offered 170,000 by their bank. Annualised day rate assessment with a specialist lender produced an assessed income of 138,000 pounds and a mortgage offer of 517,000. They bought a 4-bed detached in Cove. Same income, different lender, different outcome.
What You Need to Qualify
Most specialist day rate lenders require the following from Farnborough corridor contractors:
Current contract
Minimum 3 to 6 months remaining on your current contract, or a renewal letter if you are between contracts. Some lenders accept a contract renewed within the last 6 weeks.
12 months contracting history
Most lenders want to see 12 months of continuous contracting, though some accept 6 months for the right profile. Short gaps between contracts of up to 6 weeks are generally accepted.
Your latest contract document
The contract showing your daily or hourly rate. This is the primary document lenders use — not your SA302, not your company accounts, not your payslips.
IR35 status clarity
Whether you are inside or outside IR35 affects which lenders and which assessment method is most favourable. We review your position and identify the optimal approach before any lender approach is made.
Inside IR35 vs Outside IR35 in Farnborough
Since the 2021 IR35 reforms, many contractors at large Farnborough employers — including QinetiQ and BAE Systems — were moved inside IR35. Inside IR35 contractors are paid via an umbrella company or PAYE and receive a different pay structure. Some specialist lenders still use day rate annualisation for inside IR35 contractors; others use the PAYE equivalent or umbrella payslips. We assess your specific IR35 position and identify which lenders offer the most favourable assessment method for your circumstances before making any recommendation.