Can you get a mortgage with temporary employment?
Temporary employment contracts in the UK are often given to workers who fulfil seasonal roles, such as working in stores during the Christmas period or as short-term cover for employees on maternity leave or sabbaticals.
Many companies also use temporary contracts simply as a screening process to filter out workers who don’t have the required skill or dedication to fill a role. Financial lending institutes are usually wary of offering mortgages to temporary workers, due to the higher risk of future unemployment compared to permanent workers.
The rules on securing a mortgage if working on a temporary contract can vary from lender to lender.
Some banks and building societies will accept applicants on temporary employment contracts, although you are likely to have your circumstances intensely scrutinised before gaining approval. The rest of your financial circumstances will need to be in extremely good shape to make up for the risk element inherent in lending to someone temporarily employed.
The bank are likely to ask you for further details about your temporary contract, such as how long you have been in work, whether it has previously been renewed or extended and whether your employer has made any indication that the post will become permanent. The industry you are employed in can also have a significant impact on your chances of securing a mortgage.
Doctors and nurses, for instance, are often employed on temporary contracts; this is normal practice for the industry and does not mean their chances of sustained employment are fragile. Roles that are considered more menial, such as cleaning work or seasonal work in fast food stores, are likely to be considered to have significantly more risk.
It may also help your application if you can show you are registered to vote and if you can put a large deposit down on the property, which will lessen the bank’s lending viability.
Banks or building societies may also request details of your credit record for the past few years, usually sourced from credit vetting agencies such as Equifax or Experian.
Engaging your partner as a co-signatory on the mortgage with a full credit-check may also increase your chances of securing lending for a property. Lenders may also wish to examine your employment track record for the last three to five years. Showing you have had a sustained period of work in the same industry with no gaps in employment will make you a much more attractive proposition to prospective lenders.
Independent mortgage advisors are a useful port of call for anyone considering buying a property for the first time. These organizations are not directly affiliated with particular banks or building societies, so can offer balanced, unbiased advice on your chances of securing a mortgage. They can also recommend lenders that are likely to be most receptive to accepting your specific financial circumstances.