Would my employment history be a problem when getting a loan?

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Trevor N
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Joined: Wed Aug 14, 2019 7:44 pm

Would my employment history be a problem when getting a loan?

Postby Trevor N » Wed Aug 14, 2019 7:46 pm

I have been working on a temporary basis for my company for 2 years. I am very conservative about my spending and have saved $30K (which I hope would be enough for a deposit). Looking to buy a home in Melbourne valued at $570,000. Would my employment history be a problem when getting a loan?

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Otto Dargan
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Re: Would my employment history be a problem when getting a loan?

Postby Otto Dargan » Wed Aug 14, 2019 7:51 pm

Hello Trevor. Welcome to the forums.

Welcome to the forums and thank you for reaching out to us.

The secret to getting your home loan approved even when you are working on casual employment basis is to show banks/lenders that you have a steady flow of income from your job.

Most lenders will look at:
  • How long you've been in a particular industry
  • The tendency of people in the industry to default on loans.
  • How stable in your income.
  • How reliant are you on any unstable income (commission, bonus, etc).
If you are in a strong financial position, you can borrow up to 95% of the property value, and if you've been in the job for 6 to 12 months. it can go even higher to 95% of property value or more if you choose to go with a guarantor).

The good news is that not all lenders require the borrower to be working in a permanent job for years. Even with the short employment history or working on a casual basis, if you have a good credit score and have industry experience, we can usually find you a lender.

We're experts at getting home loans approved for people with unusual employment.

Give us a call on 1300 889 743 or fill in our free assessment form to find out if you qualify for a home loan.
Otto Dargan
Mortgage Broker
P | 1300 889 743
Home Loan Experts

Trevor N
Posts: 3
Joined: Wed Aug 14, 2019 7:44 pm

Re: Would my employment history be a problem when getting a loan?

Postby Trevor N » Wed Aug 14, 2019 7:58 pm

Are there any tips I can use to increase my chances of approval?

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Otto Dargan
Mortgage Specialist
Posts: 7600
Joined: Sat Sep 06, 2008 5:55 pm
Location: Sydney, Australia
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Re: Would my employment history be a problem when getting a loan?

Postby Otto Dargan » Wed Aug 14, 2019 8:14 pm

Hi Trevor,

To improve your chances of getting your home approved:

  • Make sure you do not have blemishes on your credit file, and if you do, sort them out quickly to improve your credit score.
  • If you have any existing debts such as car loans, personal loans, etc, it might be a good idea to pay them out or consolidate them.
  • Do not lie and be precise about your employment history. Ensure that you provide the lender with proper documentation like bank statements, payslips or group certificate.
Cheers,
Otto Dargan
Mortgage Broker
P | 1300 889 743
Home Loan Experts

Trevor N
Posts: 3
Joined: Wed Aug 14, 2019 7:44 pm

Re: Would my employment history be a problem when getting a loan?

Postby Trevor N » Wed Aug 14, 2019 8:16 pm

Thanks for your clarification. I will get my documents in order and I am lucky enough that I do not have any major loans. How will lenders calculate my servicing i.e. how much can I borrow?

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Otto Dargan
Mortgage Specialist
Posts: 7600
Joined: Sat Sep 06, 2008 5:55 pm
Location: Sydney, Australia
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Re: Would my employment history be a problem when getting a loan?

Postby Otto Dargan » Wed Aug 14, 2019 8:27 pm

Hi Trevor,

You can use our borrowing power calculator to find out how much you can borrow.

Assuming you earn an income of $80,000 yearly and have no debts or personal loans and you're looking to borrow $500,000, then a lender could let you borrow up to $514,000. While you are borrowing close to your limit, this is fine if you are in a strong financial position and good credit score.

Lenders have their own methods of calculating your income. The most popular method used is looking into your group certificate for the last two years and taking the lower value of the two.

Other lenders use the Year To Date gross income is shown on your payslip to calculate your annual income. This is the method preferred for casual employees who've been working in the same job for a few months.

You can use our Year to Date Income calculator to assess your income.

Give us a call on 1300 889 743 or fill in our free assessment form to find out if you qualify for a home loan.

Cheers,
Otto Dargan
Mortgage Broker
P | 1300 889 743
Home Loan Experts


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