Experiencing changes in your employment situation? You may have moved industries, changed jobs or just started in your first. In these circumstances you may be required to undergo a probationary period.
This may be long or short term, but it means that for that period of time the future of your employment situation is uncertain.
Despite your extensive experience your status as a high earning professional, the banks are still concerned that you may not be able to meet your repayment obligations whilst under the probationary period.
This means that if you apply to a single lender you may face significant complications in obtaining a mortgage!
Do not worry! We work with many lenders and if a loan exists for you we can find it.
How do the banks view my application?
If you are on probation there is no guarantee of permanent employment at the end of the period, making your employment situation uncertain. Although you may be an IT professional with a high salary or employed in a high-demand industry, from the banks perspective you pose a higher risk of default.
As you may encounter difficulty fulfilling your obligations under the loan. The bank places large weight on these factors when assessing your eligibility to get a mortgage. As a result, your application may be declined!
Speak to us today on 1300 886 115 or enquire online to discuss your situation with one of our specialist mortgage brokers.
How we can help?
Although some major lenders see probation as an issue, we know lenders who don’t find it an obstacle to approval. You will be in a stronger position where you:
- Having been working in the same industry as your previous job
- Have extensive experience
- Your probationary period is no longer than 12 months
If you meet these criteria, you may be eligible for a mortgage!
How much can I borrow?
Depending on your situation, you may be entitled to borrow up to 90% LVR. The loan can be used for a variety of purposes, including the purchase of your first home, investment or construction.
How much you can borrow may depend on what industry or type of employment you work in, and also how you are paid. Doctors on probation for example may be more likely to get loan approval than someone who earns bonus income or receives a large percentage of pay in overtime.
What if I’ve only been on probation for a day?
No worries! We know of lenders that will still allow you to borrow! It doesn’t matter if you’ve been working for a day, a week or 3 months. Contact us and explain your situation to one of our mortgage brokers. You’ll be surprised at how much easier the process will be!
How can I protect myself against default?
As there is no certainty that you will maintain your job at the end of the probation period, we highly recommend that assess your personal ability to make loan repayments and take significant precautions to ensure financial security should you become unemployed.
One of the best ways to ensure that you can still meet your obligations under the loan, should your job terminate is to have savings! We recommend 6 months worth of savings to cushion any unexpected financial obligations that may arise on top of your loan repayments. You may also like to look at obtaining income protection insurance.
However, it’s best to speak to your employer before you decide to apply for a loan. You may want to request an early review or ask them questions regarding your performance. This will help you gauge whether your employment will continue after probation.
Already talked to your employer? We can help you apply! Contact us on 1300 885 115 or enquire online today.
What is probation?
Employees are now regularly undergoing probation periods for many large companies. It is designed to allow the employer to monitor your performance before committing you to full time work. It also serves as a trial period in which you can decide whether you find that job suitable before undergoing a contract of employment. They are often imposed when moving between industries, changing jobs or entering into the workforce.
How long do probation periods they last?
Your contract of employment specifies how long the period will last and will usually vary depending on your industry. Typically they are short term and will last for 3-6 months. However, some government sectors impose probationary periods for up to 12 months. At the completion of probation, your employer will usually review your performance. They may terminate, extend your probationary period or permanently employ you.
Contact us today!
Speak with a team that has dealt with cases like yours! We here at Employment Mortgage are the leading experts on unusual employment situations. Enquire online or call us on 1300 886 115today so that we can assess your individual situation and help you get a mortgage!