How you earn you in come is important when the banks asses your ability to afford a loan. If you receive regular income that is earned from a stable job with fixed hours, banks are more likely to give you a loan.

If you do shift work and receive penalty rates? Contrary to what you may think, only some banks and lenders will accept these earnings as part of your income. Read on to find out more!

Do the banks include shift allowances as part of your income?

Banks are generally reluctant to include shift allowances as part of your regular income because these penalty rates are not a fixed part of your remuneration package.

Although they provide an additional source of income, it may not be ongoing as your income will be reduced if you decide to take conventional shifts. The banks are of the belief that shift work varies greatly and if you no longer receive penalty rates you may not be able to meet your mortgage the repayments.

If you are unsure of how the lenders will view your application, contact us on 1300 886 115 or enquire online and our mortgage brokers can help assess your individual situation.

The biggest difficulty when applying for a loan is overcoming outdated lending policies. Shift allowances are a common form of income and are recognised by some banks. This is why it is important to apply with the right lender!

How do they determine my income?

Where the documentation evidences that your shift allowance is regular, it may be included as part of your income. However, if you rarely receive a shift allowance, they may not be included. This is because the banks believe that they may not be ongoing and as such, will be not included in a serviceability assessment.

Who should I apply with?

The type of income that is acceptable largely depends on which lender you apply with. Some non-conforming lenders are more flexible and will accept the all penalty rates of income. Our brokers work with three particular lenders who generally accept 100% of all shift allowances, if there is evidence that this income is regular.

If you are a fulltime employee and you receive penalty rates for working weekends or nights, 100% of that income will also be accepted! However, money for things such as meals and travel expenses are not considered shift allowances and therefore cannot be included as part of your income.

What documentation do I need to provide?

We know of lenders that may accept your shift allowance! You may be required to supply:

• A copy of your group certificate or letter from your employer.
• A year to date payslip in order to ascertain if your shift allowance is regular

What is a shift allowance?

A shift allowance is a sum of money paid to a worker for either the timing, or nature of their work. You may be a nurse who receives a penalty allowance for each hour of the shift that it worked at night time or on the weekend. Or the shift allowance can be paid per rostered shift.

Who receives shift allowances?

A number of people working in emergency services receive shift allowances. Hospitals and surgeries are open 24 hours a day, seven days a week. Nurses, doctors and emergency staff commonly work on a shift basis and do not have ordinary fixed hours. Due to the nature of their work, they may be called in to commence a shift at any given time and as such, receive extra rates.

What types of shift allowances are there?

You may receive a shift allowance where you work the morning shift, afternoon shift, night shift or weekend shift. Similar to a rate for working overtime, a penalty rate is one awarded for certain types of shifts.

Why speak to us?

Lending policies differ across financial institutions therefore it is important to speak to our mortgage brokers! Don’t waste time submitting your application with a bank that will outright decline your employment mortgage loan based on your occupation. Contact us today on 1300 886 115 or enquire online and we can help you get approved!