Congratulations on having a new baby!
Juggling family life and work has never been more difficult. The last thing you need to worry about is your home loan and how you’ll manage your family’s budget while away from your job.
Can I get a mortgage?
Did you know that some banks and other lenders can still approve a home loan or loan increase for you even though you’re not receiving an income?
- You can borrow up to 80% of the property value (90% on a case by case basis).
- If you’re on unpaid leave then you must have funds set aside to make repayments.
Give us a call on 1300 889 743 or fill in our free assessment form and one of our mortgage brokers will give you a call to discuss your situation.
Which banks will consider maternity leave?
Most banks will decline your loan application outright because there’s a risk that you’ll not return to your previous job, will have another baby or because they can only assess your current income.
Although some banks have strict lending policies, we know lenders that will still allow you to borrow. However, there are certain requirements that you must fulfill, as well as specific documentation that you will have to provide.
What do I need to provide?
Most lenders will request that you supply evidence of your employment and income. You may be required to provide:
- Payslips (from the last 3 months prior to commencing parental leave).
- A letter from your employer stating the terms of the parental leave, particularly the return date and the employment tenure upon return (full time, part time or casual).
What factors do banks take into account?
When banks consider lending to mothers who are staying at home with their newborn child, they generally take into consideration the length of time until you return to work. They also consider your ability to cover the loan repayments using:
- Money that you have on standby;
- Equity you have in your home; or
- Government benefits you’re receiving.
However, the duration of the maternity leave is also an important factor. If you’re concerned with your ability to get approval, fill in our free assessment form or speak to one of our mortgage brokers on 1300 889 743 to find out how we can help.
How long can I be on parental leave for?
Generally, the maximum period of leave that lenders can consider is 12 months. However, they view smaller periods such as 6 months or 18 weeks more favourably.
If you’re clearly going to struggle to afford the loan while on leave, the bank won’t approve your application. All lenders we deal with practice responsible lending.
To discuss your situation with an expert mortgage broker, contact us on 1300 889 743 or fill in our free assessment form today. We can help you get approved, even if you’re going on maternity leave.
Paid or unpaid maternity leave?
Paid maternity leave is viewed more favourably by the banks. The problem most people face is that often you may only be paid half of your normal salary while on leave, and so most lenders won’t assess your loan based on your normal salary.
Unpaid maternity leave is treated by almost all banks as if you were unemployed! Even if you have a set date to return to work, many will still not approve your loan until you’re actually back at your job.
Luckily, not every lender views unpaid leave that way. To find out which lender will approve your mortgage, contact our expert mortgage brokers on 1300 889 743 or fill in our free assessment form today.
What if I am pregnant?
It’s better to obtain a home loan while you’re pregnant and still working rather than while on leave.
We can offer you loans from a wider selection of lenders so you’re more likely to get a better deal.
It’s critical that you plan your finances well in advance of the birth so that you don’t get caught out later on if you need more funds than you anticipated.
Avoid unnecessary stress by completing our free assessment form and speaking to one of our specialist mortgage brokers on 1300 889 743.
How much can I borrow?
Can I borrow extra to cover my expenses?
If you have enough equity in your home, you may be able to release some funds to help you make your repayments and cover your family’s expenses while you’re away from your job.
The banks use many names for this type of home loan that has a break in the repayments for up to twelve months. You may hear it being called a Mortgage Safety Net, Repayment Holiday or a Repayment Pause.
Apply for a home loan today!
Here at Home Loan Experts, our mortgage brokers have extensive knowledge of the guidelines used by Australian lenders.
Please fill in our free assessment form or call us on 1300 889 743 to discuss your situation with a mortgage broker who can quickly find you a lender that will accept your loan while you’re on maternity leave or while you’re pregnant.