With the employment market being what it is, an increasing number of people are looking for alternatives to traditional jobs. Contract employment is one such alternative. A significant portion of the Australian population is under contact employment. This type of employment allows people to enjoy steady income and a great deal of flexibility. In many ways, contract employment can be very convenient and beneficial. However, it can be an obstacle in your path if you want to get a home loan. After all, most lending institutions would consider the contractor’s income and financial situation to be unreliable. We at Mortgage Providers, will help you find a lender with the best possible deal for contractor home loan.
Will You Get the Loan?
Most lenders will invest their money in people who are capable of paying back. That’s why they prefer salaried individuals or people with very steady income from well-established businesses. However, most lending institutions now recognize that they can’t afford to ignore professional contractors, freelancers, self-employed contractors, etc. They will give you loans, it’s just a matter of proving to them that your financial situation is stable and it will continue to be so for the foreseeable future. Most lenders would prefer it that you have two years of experience in the same industry and have worked for the same employer for a few months.
There are some low-risk professionals or industries that would have an easier time getting a contractor home loan. Professionals in the IT field, for example, have a better chance of getting home loans. You will also have a better chance of getting a loan if you’re a PAYG contractor. Such contractors are almost similar to normal, permanent employees. Their employers will pay the taxes and super obligations and in many cases might even offer sick leave or holiday pay. Lenders usually have more confidence in such contractors, especially if they’re established in the industry and have been working for the same employer for a considerable amount of time.
Getting a home loan can become a little more complicated and troublesome if you’re employed under short-term contracts of six months of less. In such cases, you’re considered a riskier investment by the lenders. They might resist your loan application. You need to provide proof of your ability to find a new employer quickly. You can do that by showing your previous employment history and your experience in the industry. You can consult our expert brokers regarding your eligibility for loans. We will help you find lenders who are willing to help contractors. We will also help you choose the best loan deal.
Things to consider before applying
Before you start looking for a loan, try to understand what you need. Think of your financial situation, consider your savings, and what kind of property you need. You might also need a letter of employment to prove your future financial stability during the application for contractor home loan. Consider the following questions.
- What is your maximum budget for a new home?
- Will you be financially stable for the foreseeable future?
- How much money do you need?
- Would you be able to pay back the money comfortably?
- What kind of loan do you need?
- Can you offer some security to the lenders?
If you want to know more about our contractor home loan, all you need to do is get in touch with us at Mortgage Providers. You can do that by filling in this contact us form or calling us at 1300 65 6600. You can ask for free expert advice or enquire about the loan. We will reply as quickly as possible with answers.