Mortgage approval for fixed-term contract employees

Cheese Princess

Hi folks
My boyfriend and I are both on fixed term contracts at work. We've both been in our jobs about 18 months and get rolling contracts. We have decent salaries and no loans/credit. We've been renting together for the last 9 years.
Is there any hope of getting mortgage approval in this situation?

Lombardo86

I applied while on a fixed term contract (last year) and i am afraid that the responses were not good. Like you, i had no loans, good credit and a greater than 10% deposit for any property in my range and i was told the application wouldn't be progressed.

Unfortunately i don't think there is anything you can do until you are in more secure employment

L1011

No chance at the moment. Permanent and out of probationary periods is all that'll be accepted for employees.

bluethunder

I wouldn't get too despondent yet OP. Myself and my wife applied last year thinking we would be turned down. She is permanent but only works two days a week so not the primary earner. I, on the other hand, am the primary earner and am not permanent. Neither of us earn big money (approx avg industrial wage for me) and we got approval in principle for 108k. Might not be enough for you but i was very surprised to get anything.

We didn't find anything suitable and AIP ran out after 6 months. Went back to broker again last month. Both in exactly the same position except for a baby into the mix. Got approval for MORE than the last time, 115k. My advice would be to go for it, nothing to lose.

No Pants

In the meantime, keep saving so that you will (a) (hopefully) be borrowing less and building up a pattern of saving.

Diane Selwyn

I applied as a sole applicant in October and got full approval with the restriction that the LTV had to be < 80%. I am on a 12 month contract (my second with this organisation) and my employer wrote on the form that the contract is 'renewable annually'. I work for a charity so my wage is at the lower end of the scale but my position is actually directly funded by a govt. department so the bank employee I spoke to put it down as 'semi-state' I'm not sure if that made a difference. They did request a copy of my CV and I also sent them on copies of emails from recruitment agencies (I get these fairly frequently since I did some agency work before I started this job). Its not that I've highly specialised skills but I wouldn't be concerned about being out of work for more than a day and that is all they are worried about I would think. Good luck with the application anyway.

chris85

Diane Selwyn wrote: »

I applied as a sole applicant in October and got full approval with the restriction that the LTV had to be < 80%. I am on a 12 month contract (my second with this organisation) and my employer wrote on the form that the contract is 'renewable annually'. I work for a charity so my wage is at the lower end of the scale but my position is actually directly funded by a govt. department so the bank employee I spoke to put it down as 'semi-state' I'm not sure if that made a difference. They did request a copy of my CV and I also sent them on copies of emails from recruitment agencies (I get these fairly frequently since I did some agency work before I started this job). Its not that I've highly specialised skills but I wouldn't be concerned about being out of work for more than a day and that is all they are worried about I would think. Good luck with the application anyway.

I can appreciate you feel very secure in your skills and feel comfortable about always getting work but that is fairly dodgy from the bank. You are no where near semi state. You are actually reliant on aid from the government which can be drastically cut at any budget. Look at the scandal covering the charity sector at the moment. At least they gave you it at a lower LTV ratio.

Diane Selwyn

chris85 wrote: »

I can appreciate you feel very secure in your skills and feel comfortable about always getting work but that is fairly dodgy from the bank. You are no where near semi state. You are actually reliant on aid from the government which can be drastically cut at any budget. Look at the scandal covering the charity sector at the moment. At least they gave you it at a lower LTV ratio.

Maybe so but my last role in the private sector was made redundant with no notice so this is about as secure as you get just now I'd say

chris85

Diane Selwyn wrote: »

Maybe so but my last role in the private sector was made redundant with no notice so this is about as secure as you get just now I'd say

Agree can happen anywhere really but semi state is fairly secure, charity sector is not, hence why they have would have staff on 12 month contracts as they may be concerned year to year about funding being cut and they want to be able to cut staff if needed.

Diane Selwyn

chris85 wrote: »

Agree can happen anywhere really but semi state is fairly secure, charity sector is not, hence why they have would have staff on 12 month contracts as they may be concerned year to year about funding being cut and they want to be able to cut staff if needed.

That is true. It's a gamble on their part. It's also a pretty safe bet I won't be staying in the same position for the next 20+ years regardless of if the funding gets cut or not.

chris85

Diane Selwyn wrote: »

That is true. It's a gamble on their part. It's also a pretty safe bet I won't be staying in the same position for the next 20+ years regardless of if the funding gets cut or not.

That's fair enough.

snickerpuss

Often wondered how mortgages work for professions which are solely contract based. Mine is. Anything from 1-5 years but all contract. Partner is permanent semi-state so hopefully that will tide us but slightly depressing knowing my salary will not be taken into account at all probably.

chopper6

snickerpuss wrote: »

Often wondered how mortgages work for professions which are solely contract based. Mine is. Anything from 1-5 years but all contract. Partner is permanent semi-state so hopefully that will tide us but slightly depressing knowing my salary will not be taken into account at all probably.

You shold be okay with the partner is something pretty secure and your own wages will be taken into account provided you can prove you will have x-amount of money available to spend after the mortage.

Something similar happened with me and my ex when we bought our house.

She was a self-employed dance teacher and we had to get an accountant to draw up an affadavit or something in relation to her earnings.

Of course we got a friend to do it and they accepted it without any bother.

Cheese Princess

Thanks for the advice everyone. I reckon my employer would give me a letter like you got Diane so maybe that will help. Have to save a bit more first anyway.

Trish56

Cheese Princess wrote: »

Thanks for the advice everyone. I reckon my employer would give me a letter like you got Diane so maybe that will help. Have to save a bit more first anyway.

Your application will be considered depending on your occupation, employment sector, your experience and qualifications. Lenders are starting to lend more and are not as strict. .

HimalayaJoe

They seem to take this on a case by case basis. I've had a few different banks tell me different things, but the standard response seems to be that you need to have been employed for at least one (preferably two) years with the same employer, and you need to be on your second consecutive contract with that employer (or have written confirmation that you will be given another contract).

I work in a university where around 2/3 of the research staff are on fixed term contracts. I just have to hope that I get another contract at the end of this year and then go back to the banks with that in hand.

A word of advice: Make sure your mortgage adviser know what they're talking about. The first bank I approached was Ulsterbank and the adviser there told me that I should have no problem getting approval because I only needed to have been employed for 6 months (I currently have around 18 months). After putting all the papers in for approval, word came back pretty quickly that there was no way I was getting a mortgage.

I'm sure others feel the same frustrations as I do. I'm trying to get a very small mortgage of 50k with 80% LTV. The repayments would be less than I've been paying in rent for the past 7 years (consistently, whether I was employed or not).