If you’re looking to invest in a rental property whilst still working through your probationary period in a new role, it’s safe to say you don’t like doing things by halves!
But jokes aside, it can be trickier to secure any kind of mortgage – be it residential or Buy-to-Let – when you’ve just switched jobs. There are mortgage lenders out there who will be willing to consider your application, but you’ll usually need to prove to them that you’re on track for permanent employment, as well as meet other important criteria that helps them assess the eligibility of new landlords. While it's not always straightforward, it's certainly not impossible to get a mortgage during your probationary period.
What to consider when applying for a Buy-to-Let mortgage
A Buy to Let (BTL) mortgage is designed for people who are looking to purchase additional property and rent it out in order to make a profit on their initial investment. In the UK, there are no limits on how many properties one person can own – so, as long as you understand your responsibilities and duties as a landlord, it can be an incredibly lucrative way to generate capital.
When looking for a Buy-to-Let mortgage, price is a very important factor, as it will directly affect the viability of your investment. When working out how much you can afford, you will need to consider how much you will need to set aside for the payments on your residential mortgage (if you have one), as well as any other financial commitments that could affect your ability to keep on top of your BTL mortgage repayments. Remember, too, that Buy-to-Let deposits are significantly larger than those for a standard residential mortgage. Mortgage providers will usually need a bigger down payment to not only secure a mortgage in the first place but access the most competitive rates.
Buy-to-Let mortgages have been notoriously difficult to obtain in the past due to stringent income and affordability checks, not to mention volatile markets. For the best chance of success, it’s important to explore all your available options before making a decision on which lender to use.
How will being in your probation period affect your BTL mortgage application?
If you’ve just started a new job and are in your probationary period, you may find it challenging to get a Buy-to-Let mortgage. This is because, from the lender’s perspective, your source of income has not been secured yet, so you’re considered to be a riskier candidate for a loan.
While there are many High Street lenders who will immediately turn away applications from those in their probationary period, there are a growing number of companies that specialise in providing mortgages to recently hired employees.
You may find that the lender will want to get in touch with your employer to confirm the length of your probationary period and to review your new job offer as part of their evaluation. It’s also worth noting that underwriters are unlikely to be able to factor variable pay elements – such as bonuses or commission – into your overall income when you’re still in your probation period. This means you might not be able to rely on these variable projections to generate the multiples you need to secure the right loan amount for your investment.
If you’re still in your probation period and are looking for a Buy-to-Let mortgage, we highly recommend working with a specialist broker who will be able to point you in the direction of lenders who are more likely to accept you.
Why use a mortgage broker?
Your best course of action right now is to speak with a mortgage adviser with specific experience in helping new employees secure attractive rates on Buy-to-Let mortgages. CLS deliver mortgage advice to every type of borrower, whatever their previous employment history. Even without an employment contract, as a whole of market broker we track down the mortgage providers who will accept an offer once they see your basic salary and have a few other details confirmed.
You can book an appointment quickly and easily via our website, and you’re welcome to chat with a CLS expert broker online, over the phone, or in person. We’ll use your initial consultation to gain an understanding of your requirements and your current circumstances, and from there we’ll provide you with a series of BTL mortgage quotes from lenders who are likely to consider your case. And remember, all our initial advice is 100% free, so you really don’t have anything to lose!
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Here at CLS, we don't just deal with probationary period mortgages, we help all kinds of people get a mortgage. With plenty of alternatives to the mainstream lenders, our mortgage brokers know many lenders that will deliver mortgage approval on all kinds of home-owner loans. Whatever you need, just ask; we're certain we've got the answer and the right mortgage for you!
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