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Mortgages for Temporary Workers

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By Pete Mugleston  | Mortgage Advisor Pete has been a mortgage advisor for over 10 years, and is regularly cited in both trade and national press.

Updated: 9th December 2019 *

Those on temporary contracts may think obtaining a mortgage isn’t possible, but there are many lenders who are happy to lend to contract workers.

Obtaining a mortgage with a fixed term contract is more possible than many people think, with several lenders offering those with temporary jobs and agency workers the ability to secure financing for a property. 

Having an unconventional income shouldn’t put you off seeking help to secure a mortgage which fits your circumstances.

In this guide we discuss the following:

This article relates solely to mortgages for people on employed contracts. For information on getting a mortgage when you work on a self-employed basis, click here.

If you’re a contract worker and want to know what kind of mortgage you might be able to get, talk to one of the expert brokers we work with. All the experts we work with have whole-of-market access so can find the most competitive rates on offer for your own circumstances.

Call 0808 189 2301 or make an enquiry for a free, no obligation chat.

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Types of temporary contract

First off we’ll briefly identify the different types of “temporary work” and the criteria you’ll need to meet to get a mortgage on a fixed term contract.

Getting a mortgage with a fixed-term contract

These contracts have a specified start and end date agreed upon beginning the employment contract. In some instances, fixed term contracts do not specify a period but end upon completion of a specific task. 

When you apply for a mortgage when your work contract is a fixed-term, lenders will often want to see a track record of previous work considered relevant.

Mortgages for temp agency workers

Similar to fixed-term contracts, these are not expected to become permanent. These contracts tend not to have an end date usually and when they do they are subject to change.

The type of job role you have can impact which mortgage lenders will help you but don’t worry as we have our own team of professional advisors who can advise you.

Obtaining a mortgage on a short-term contract

Often defined by the length and the nature of a given project, they’re distinctly different from fixed term contracts. 

If you want to get a mortgage on a short term contract, like other forms of temporary work, a track record of experience within your role plays to your advantage. And it’s likely any mortgage lender will want to see evidence of this.

Mortgages for workers within their probation period

Probation periods are common for employees when they begin new employment. These are usually for a period of 6 months, some only 3. However, some can be up to a maximum of 12 months. 

Whilst probationary periods can cause problems with many lenders, other lenders are willing to accept the risk (though this can vary according to industry sector) and confirmation of employment beyond this date is not required.

If you’re looking for a mortgage and have a temporary job or are between jobs, you might find our article on obtaining a mortgage if you’ve just started a new job useful.

Can I get a mortgage on a fixed-term contract?

Being on a fixed-term contract won't stop you from being able to get a mortgage. However, lenders will need to see evidence of consistent income earned. As with self-employed borrowers, you will need to be able prove your level of income to reassure lenders that you will be able to afford the mortgage, now and into the future.

Alternative employment contracts still prove a valid affordability status with many lenders as you are ‘in employment’, however, some mortgage lenders will require that you meet certain criteria, like being in a contract for at least 6 months, for example.

If you feel your situation does not fit into these categories, we help our customers based on their individual circumstances. Call 0808 189 2301 and we’ll match you with one of the expert brokers we work with, ensuring that they have experience in successfully arranging mortgages for people in similar circumstances.

Next we focus closely on the lending criteria for getting a mortgage for the different types of temporary jobs many people work in.

Lender criteria for temporary contract mortgages

To obtain a mortgage, lenders will look for different things and many have different prerequisites.

Why some lenders don’t like fixed-term or temporary contracts

When applying for a mortgage, some lenders view these types of contracts as not providing guaranteed income for the applicant, which can present challenges relating to affordability. Ultimately, they’re assessing risk.

The specialists we work with will direct you to lenders who accommodate all workers, not just those who are in straightforward permanent employment. Luckily, all cases are treated individually and we do our best to ensure you receive the best advice to provide a solution to your mortgage enquiry.

Your job role

As with any lender, this will be one of the first questions they ask as this can affect your eligibility for getting a mortgage on a fixed term contract. Some roles are seen as more ‘stable’ than others based on the skill level/qualifications of the individual.

As an example, lower-skilled, labour-intensive roles such as those in the construction industry or for picking and packing warehouse operatives, will find there are fewer options than those with a much higher skill level (i.e. professionals) such as solicitors, locum doctors or teachers

Higher skilled roles will benefit from more flexible finance options and the usual rules for temporary or short term contracts can often be less strict.

No matter what your job role, we’re happy to discuss all your options for getting a mortgage with a temporary job. We have specialist advice on our site specifically for contractors who are looking for a mortgage.

Length of your current contract

Many people on short term contracts will quite often struggle looking to secure a mortgage from high street banks and lenders. When discussing your options for borrowing, lenders need to know further details about your employment contract.

As mentioned, most temp workers will be considered with a degree of flexibility when it comes to the length of your contract. If your contract is fixed or short term, lenders will usually require a minimum of 6 months remaining on the contract, although some lenders will require 12.

Even with 3 months left on an employment contract, obtaining a mortgage with a temporary job is something many lenders will discuss, other specialists consider zero months remaining, so long as there were 6 months on it when the contract started.

If you’re in a casual role with no ‘fixed’ term or more defined employment, lenders may ask for evidence of working within the same role for other employers for at least two years, this way they’re able to make an informed decision based on your work history.

Has your contract been renewed?

If your contract has been renewed at least once with your employer, there are lenders who will be happy to lend for fewer months remaining on the contract. If there are zero months remaining on the contract, official confirmation of a renewal would be considered satisfactory too.

Length of time in your current role

The ease of obtaining a mortgage for fixed-term contract employees also depends on how long you’ve been in your current role - again, this criteria will vary across lenders. Some lenders require time in your current role to be a minimum of 12 months, others 6, and others no minimum whatsoever, so long as your current role has been with the same company.

Length of time with your current employer or agency

As a temporary worker, being employed with the same agency or company for less than 12 months can present challenges with some lenders and others may decline your application. However, don’t worry as many will be satisfied if you have been doing the same job role elsewhere for 12 months.

Gaps in employment?

Have you been between roles and have gaps in your employment history within the last 12 months? For some lenders this will be a problem, others, however, will accept gaps within the last 6 or 3 months and some will have no restriction at all so long as the income is sustainable. 

In this situation, individual cases are based on certain merits.

You’ll find lenders define ‘gaps in employment’ differently, which can reflect your borrowing eligibility. Some lenders will view a “gap” as having no job for a period of 1 week, some 2 weeks, and others up to 4 weeks. As long as there’s an explanation, this shouldn’t usually be a major problem.

Getting a mortgage on fixed term contract even without a consistent run in regular employment is something many lenders will consider.

I’m on a fixed-term contract, how much could I borrow?

As with all lenders, criteria such as their max LTV (up to 95%) and affordability (up to 5x your income) remain the same as these measure your eligibility and therefore how much you can borrow. 

More specialist or adverse lenders tend to be less flexible with temporary income and usually require 12 months minimum in your current role, with as few gaps as possible.

Mortgage applications on a fixed term contract often have tighter criteria for both agency temp workers and those in fixed or short term employment contracts, thankfully this is something we are very happy to help you with, ensuring you understand your borrowing options.

Want help to get a mortgage with a temporary contract?

Try and be prepared with some of these quick and easy tips:

  • Build a credit history responsibly by using a credit card to make purchases then pay them off each month with your earnings.
  • Have documents which provide a trail of your work history (if you’ve been with your temp agency/employer less than 6 months).
  • Most lenders will advise you save for as large a deposit as you can afford to reduce your max LTV requirements. Don’t worry, you don’t need a huge deposit and this is something one of our specialist advisors can talk through with you.

Speak to an expert who can help you get the mortgage you want

If you’re looking for a mortgage as a worker on a fixed, temporary or short term employment contract, get in touch as we work with specialists who help borrowers in this field every day.

Call 0808 189 2301 or make an enquiry and we’ll connect you with an expert who can help get you the mortgage you want.

All the experts we work with are whole-of-market brokers with access to lenders across the entire UK. They will be happy to answer all your questions and help you understand the sort of mortgage deal you might expect in terms of how you earn your income.

The service is free, there’s no obligation and we don’t leave a mark on your credit rating.

Updated: 9th December 2019
OnlineMortgageAdvisor 2020 ©

FCA disclaimer

*Based on our research, the content contained in this article is accurate as of most recent time of writing. Lender criteria and policies change regularly so speak to one of the advisors we work with to confirm the most accurate up to date information. The info on the site is not tailored advice to each individual reader, and as such does not constitute financial advice. All advisors working with us are fully qualified to provide mortgage advice and work only for firms who are authorised and regulated by the Financial Conduct Authority. They will offer any advice specific to you and your needs. Some types of buy to let mortgages are not regulated by the FCA. Think carefully before securing other debts against your home. As a mortgage is secured against your home, it may be repossessed if you do not keep up with repayments on your mortgage. Equity released from your home will also be secured against it.

Find out more about how we help people get mortgages with non mainstream incomes

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