Mortgages for casual employees

Are you currently working in a casual job? The major banks are incredibly conservative when assessing the income of casual employees. They tend to ignore the benefits of employment flexibility & the higher hourly rate, but instead focus on the small number of casual workers who have unstable employment.

It is possible to get approved for your home loan. Instead of looking for the cheapest possible mortgage and then trying to convince them to approve your loan, it is best to start by looking for the lenders who can approve your loan and then working out which one is the cheapest.

What are the requirements to get a loan?

Typically most banks require you to be in your job for a minimum of 12 months before they will include your income in their serviceability assessment. However not every lender has these rules!

One lender can offer the following guidelines based on the length of time you have been in your job:

• Casual for more than 12 months: You can borrow up to 95% of the property value.
• Casual for more than 3 months: You can borrow up to 90% of the property value.
• Casual for less than 3 months: You can borrow up to 80% of the property value if you work set hours & have extensive experience in the same line of work.

If you would like to apply for a home loan then consider talking to the Home Loan Experts, they are specialist mortgage brokers who know which lenders have the best guidelines for getting a home loan while in a casual job.

Why are most banks so tough on casual employees?

The major banks simply don’t understand the modern Australian workforce. While in the past it was more common for people to work full time or part time jobs, increasingly there is a shift towards casual employment. In fact, in 2010 it was reported that over 27% of the workforce was employed on a casual terms.

The flexible working hours, higher hourly rate and ability to work several casual jobs at the one time suits more Australians than ever before. Highly skilled casual employees such as nurses, hospitality professionals and teachers are unlikely to lose their job, so are not a higher risk for the banks.

Despite this the banks still have their old credit guidelines that penalise casual employees. They believe that because employment is never guaranteed & benefits such as sick leave are not in place, that you pose a higher risk to the bank.

Applying for a home loan

If you would like to apply for a home loan while working in a casual job then consider contacting a mortgage broker that specialises in casual workers, such as the Home Loan Experts. They can complete an assessment of your current position and then advise you on the most suitable lender & home loan.