Getting a home loan while on probation
A probationary period is a common part of many people’s employment contracts. It stipulates that your performance within a company will be under review from between three to six months.
During this time the employer can decide whether they wish to hire you on a full-time basis, and for you, it’s a good time to see if you fit within the fabric of a company. Whilst probationary periods have many advantages, it could be the one thing that impedes you from getting a home loan.
Lenders and financial institutions see those on probation as a higher risk due to lack of employment stability. They are reluctant to lend to those who are not currently committed to full time work, despite their high salary and professional status.
This is commonly difficult for those who have travelled from overseas and are just entering the workforce, those that have taken maternity and students who are just starting a new job after graduating. Banks often prefer those returning to the same line of work or entering into the field that they have studied in. They may also require evidence of study and birth certificates from mothers who have taken maternity leave.
Further, changing careers, jobs and being head hunted to a new department can also mean that you are subject to a probationary period. Lenders are more inclined to approve loans for those whose new job is in the same industry. Often you will be able to borrow up to 90% of the purchase price.
However, it is important that you speak to the right broker. They can assist you in formulating your application so there is a higher chance of being approved the first time round! Don’t let a probationary period stop you from getting that home loan. Talk to an expert today.
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