What my dad’s bank manager taught me about security:
Do you know what used to get on my nerves about my dad’s bank manager? Apart from the never-quite-straight wig and invisible cigar fumes leeching from his every pore?
It was the way he insisted upon ruffling my hair every time I met him. Back then, those meetings (and subsequent barnet-buffing) were all-too-often occurrences.
Neither my dad nor I ever said anything. I can’t say that my dad even acknowledged the angst this gesture ignited in me. If so, he never let on, as it was a completely amiable gesture on the bank manager’s part.
To soften the blow, he’d always give me a new 50p piece when we were leaving his office. Those big old fat ones that could double up as saucers if mom got the best china out.
Whether it was with my dad at the bank on Fridays or the private club on Sunday lunch times, I’d get ruffled up and 50p for the trouble. To be fair, it was a decent pay-off.
But it wasn’t just me. So many of us kids at the club would be 50p better off on the way home. Thinking about it, he must have had trousers tailored from anti-gravity material. That shiny, seven-sided hoard must have weighed a ton in his pocket.
If he was still alive today, apart from being about 100 years old, I bet he’d still be giving kids half a quid. Whether he’d muster enough strength to spoil their ‘do’ through layers of hair gel is another matter.
Do banks still have branch managers?
Okay, that was longer ago than I care to remember. As it stands, I’ve never even spoken to my current bank manager, let alone met them. Do smaller branches even have them these days?
You may (or may not) remember when bank managers used to be an integral part of the community. They knew you and your family by name if you were their customer. Even if you banked elsewhere, you’d recognise them as a pillar of the community.
The likelihood was that your bank manager knew your parents, like my dad’s knew me. When you were ready to buy your first home, he’d tell your parents to send you along for a chat. And, yes. In those days, it was always a “he”.
If you were moving up in the world, he’d be discussing your plans and business aspirations for months. What could the bank do to help? Your dad, he would assure you, would always be good for security if you needed a loan.
Paying rent? He’d have none of it. You’d be in his office, your dad would be stumping up a deposit and you’d have the keys to your own place before you even learnt to shave. Okay, maybe that last one’s exaggerated a bit.
But what the bank manager would have known personally is how you, as a business owner, operated. From the ground up, your mortgage, your business and yes, even your kids’ names.
Care for your financial wellbeing lost to indifference
Today, we’re unlikely to see any of these old-fashioned traits displayed in branch. The relationships you’d build, based on trust and interaction, have no foundation in today’s banking system.
True, it paid to keep your bank manager sweet. Folks dropping a bottle of Scotch into their branch at Christmas was commonplace. Imagine doing that now? You’d either get arrested or served with an ASBO.
But it’s that hands-on responsibility you’d expect from your bank manager that’s been all but removed. Decisions are made with shareholders in mind and determined by rigid procedure.
No longer can your bank manager make a judgement call on your mortgage application. Instead of applying common sense fundamental reasoning and their knowledge of you, you are processed.
And who’ll process your application? Underwriters, trained with clinical precision to spot danger signs and flag them up.
Do they know why there’s a blip on your credit file, sat as they are at head office? No. But neither do they care. Black/White. Reject/Accept. It’s that simple.
Now, if there’d been a genuine reason for a financial faux pas, your good old bank manager would have known why. He’d have taken this into consideration and appraised your circumstances accordingly.
But over time, waves of change have eroded their role. To in-branch staff, you’re nothing but an account number and a credit score. If one or the other is adverse, the chances of you accessing anything but a savings account are slim.
A clique was a community, not how we banked online
It’s sad that those days have long gone. Technology has overtaken community. Sort codes and account numbers have taken over from names and faces. But it’s not only branch staff who make banking impersonal today.
Many people do their banking online. Switching money between accounts, into (and out of) ISAs. Company owners or directors can transfer cash, dividends and shares without leaving their laptop.
We can do it all with a mouse, a click, a tap of the app and a secure WiFi connection.
If e-bankers need to talk to someone, they get through to a call centre in a far off land. The person on the other end of the line has no idea where your town is, let alone what it looks like or who lives there.
What you do as a profession and the impact upon your life any decisions those call centre operatives make is lost to impartiality.
They rattle off questions (and answers) in parrot fashion. And there’s a culpable relief from both parties when the call’s finished.
No matter. You can always check your statement online later to see if “John” understood your instruction…
Putting the personal back into finance
…here at Freelancer Financials, we understand the impersonal nature of business finance today.
But that doesn’t mean it can dictate the way we work. It definitely doesn’t mean we have to operate in an impersonal way ourselves.
Our aim is to get financing back to those good old days. At least in spirit. We like to get to know all our clients by name. Their business, their hopes and dreams, their aspirations for themselves and their families.
By so doing, we know the most suitable finance products for their unique circumstances when the time comes. And all contractors are different. That’s one thing that’s not changed.
Whether you need a pension or a mortgage, insurance or help with your limited company accounts, we’ll know your status. That’s the aim. Offering no more or less than you need, unless you categorically ask for it.
Contractor Mortgages tailored especially for you
We offer mortgage advice tailored to the unique needs of freelance contractors. Why? Because the High Street either doesn’t or won’t pander to independent professionals.
The products they peddle are irrelevant to most self-employed people. As a result, the High Street can leave contractors confused, unsure of what cash they can or can’t access.
We only deploy experienced financial consultants. Furthermore, they specialise in specific types of mortgages for contractors.
They’ll find out all they need to know about you. This includes how and when your clients pay you and your specific finance requirements. Only then will they decide which product is the best fit for your circumstances.
You’ll have one dedicated Specialist Mortgage Adviser for the duration of your enquiry. They’ll deal with your application, its approval and the finalising process on your behalf.
We’re 100% impartial, too. That gives you access to the whole market, meaning you get the best mortgage available from all relevant lenders.
Our experience has helped us develop strong relationships with lenders and underwriters. Couple that with the fact that the majority of our clients are contractors, you know it’s relevant experience. Just like in the good old days.
We know the banks and building societies who are contractor friendly. We know where your mortgage application will be successful. We give you the best chance of optimising your contract to secure a mortgage, full stop.
This saves you, us and the lenders so much time. Days that could be critical in you securing the home of your dreams. Or not.
How much can I borrow?
Relationships with contractor-friendly mortgage lenders have helped us carve out terrific deals. These deals are set arrangements that we use for almost all contractors.
Using their earnings multiplier, we secure your mortgage based on your annualised contract rate.
What’s a multiplier? It helps work out how much you can afford; as a guide, it’s four-and-a-half times your annualised salary. Mm, it may be easier to show you in an example.
Example: how lenders assess a contractor’s mortgage affordability
First, multiply [your day rate] by [number of days worked per week], by [number of weeks worked per year]. This gives you your annualised contract rate. Then, multiply that figure by the [lender multiplier].
We’ll use a contractor who earns £350 per day and works standard hours to walk through the maths:
- Base (day) rate = £350:
- x 5 days per week = £1,750;
- x 48 weeks per year = £84,000;
- x 4.5 multiplier = £378,000!
Now, jump to our » contractor mortgage calculator and work out how much you can borrow using our agreement.
Done that? Great. Now, just hear me out, we’re almost done, but this bit is important. Then you can call us to see how you go about starting that ball rolling.
Your application reaching the right people is critical for success
The success of your application will depend upon how it’s packaged when it arrives with the underwriters. Or, for want of a better term, ensuring that the decision makers only see what they need.
That’s doesn’t mean we try and hide anything from them. They just don’t need accounts, payslips, anything like that. We know, because we’ve sat around the table with them and thrashed this thing out for you.
Rest assured, our Specialist Advisors know exactly how this should be and where to send it. The senior underwriters with whom we deal have an inherent knowledge of the way contractors work.
They don’t need the reams of unnecessary paperwork the High Street asks for. They just want the basics to get the job done.
Freelancer Financials has, believe it or not, adapted with the times. Of course we have. But our underlying ethos of building strong, personal relationships sets us apart in London. At least we like to think so.
Yes, the new contractor mortgage arrangement is reminiscent of my dad’s old bank manager. And strange as it seems, it wouldn’t hurt him ruffling my hair again…
…if only I’d got some left to spoil!
Come, talk to us. Whatever your needs as a freelancer, we can help. And I promise not to ruffle your feathers. Deal? Deal!
Author: John Yerou
John Yerou is the owner and founder of Freelancer Financials; a trading style & trade mark of the award winning Mortgage Quest Ltd. One of the most recognised names in providing mortgages for contractors and freelancers across the UK.
In 2004 John began his career in Financial Services as an independent mortgage adviser and broker. John has been instrumental in negotiating bespoke underwriting for contractors with high street lenders.
His presence in the industry as a go-to expert is growing by the day and he is regularly cited and writes in publications both locally and nationally.