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Re: Why is it difficult for contractors to get a home loan?

Posted: Fri Jun 01, 2018 1:45 pm
by Otto Dargan
Hello Sanadis. Welcome to the forum.

Lenders typically treat contractors like casual employees. This might partially explain the rejection of your friend’s home loan application by the bank.

Contract workers are considered to be in a very unstable employment arrangement with a high chance of having their contract cancelled, even if they are employed through primary contractor management firms.

PAYG contractors (your case) are usually employed on a fixed term, short term or long term contract, usually with an end date or in some cases with an automatic roll-over to a new contract.

They generally have to prove a strong track record of experience in the same industry as well as future employment stability for getting their home loan application approved. Also, many lenders require over 12 months in your current role as well as evidence that your contract will be continuous and ongoing.

If you want to know more about these then you can check out our website. You can also speak with one of our expert mortgage brokers directly by calling 1300 889 743 or by filling in our free online assessment form. This applies to your friend too :)

Cheers,

Re: Why is it difficult for contractors to get a home loan?

Posted: Fri Jun 01, 2018 6:04 pm
by Otto Dargan
Hi Sanadis,

Regular documents are required for a home loan application like basic identification documents and savings statements. In most cases, you’ll be asked to evidence your income and future employment stability through a letter of employment.

They need to print the letter on their letterhead, keep the details, print, sign and fax it to your mortgage broker.

The secret to getting a home loan while working as a contractor is to apply with the right bank! To know which lender is suitable for you, call us on1300 889 743 or enquire online.

Cheers,