Lots of people enjoy the flexibility that comes with working on a zero-hours contract. However, despite the many benefits of these kinds of arrangements for today’s agile workforce, getting a mortgage without a more formal agreement in place can be particularly challenging.
If you’re looking to purchase your first home, but you’re worried that your work circumstances will affect your eligibility for a mortgage, read on for a list of the things you’ll need to think about as you make your way through the application process. You’ll also find more information on how the mortgage brokers here at CLS Money can help you navigate the market and track down the right deal. We'll match you with the specialist mortgage lenders who regularly fund new borrowers with a zero hour contract income.
Things to consider as a first-time buyer
Lenders define a first-time buyer as someone purchasing a property who has never owned a home previously.
If you’re a first-time buyer, you might not fully understand the mortgage process, so it can be really helpful to speak to an expert to talk you through it. He or she will explain all the key terminology and help you work out how much your monthly repayments will be, as well as how much the mortgage will cost you over the course of your full term.
One key thing to ensure from the start is that you have all the right documents to hand. Any errors, inconsistencies or omissions from your paperwork could be a red flag to your lender and could put you in a poor position when it comes to being accepted for a mortgage.
As a first time buyer, you might not have a strong credit history. Chances are, you’ve never had to pay back this kind of debt before. From the lender’s perspective, taking you on as a mortgage customer is a risk because they have no examples of your reliability as a debtor.
This is why it’s so important to use a mortgage broker when looking to apply for a first-time buyer mortgage. Their expertise will help you meet lender criteria with mortgage repayments you can safely meet on your zero-hour contract. In turn, that gives you a better chance of being accepted for a mortgage and securing your dream home.
How will being on a zero-hours contract affect your chances of getting a mortgage?
Most mortgage providers typically require you to be in full-time work in order to be eligible for a loan. But with more than two million workers in the UK currently employed on zero-hour contracts, lenders are slowly starting to catch up with the state of the market by offering products that are better suited to individuals working to more changeable agreements.
As a zero-hours worker, you may struggle to get your mortgage application accepted by some of the better-known high street lenders – even more so if you are a first time buyer with no history of taking out a loan of this size.
Any mainstream lender, high street banks in particular, will often have concerns that your job is too unstable and your income is too unreliable. However, there are plenty of specialist providers out there who will be happy to take your employment status into account, providing you with the zero hour contract mortgage you're looking for.
The key to success, and getting you onto the property ladder, is to prove to lenders that you’re not a high-risk borrower and will be able to make your repayments with no issue. Being prepared and having any relevant paperwork ready to hand will help your mortgage broker manage your application for the best possible outcomes.
They'll need some proof towards your approximate annual income, perhaps a bank statement or a collection of previous payslips, as well as a list of your monthly outgoings. If you can show you've worked for the same employer for a reasonable period, provide a stable employment history, and that your current position provides a steady personal income, we might even be able to get you lower monthly payments than you initially expected.
For the best chance of proving your eligibility – and securing a deal at favourable rates – you need to work with one of our specialist mortgage brokers. They will be able to introduce you to a pool of lenders who are likely to accept your employment situation and offer you attractive and sustainable mortgage terms.
Why use a mortgage broker?
At CLS Money, we have many years experience in securing mortgages for applicants who lenders see as working in less favourable circumstances – including those on zero-hours contracts.
We excel in guiding first-time buyers through the mortgage process, too. We’ll take the time to understand your situation before presenting you with a series of quotes from suitable lenders. Then, once we’ve identified a mortgage provider who is likely to accept your case, we’ll help you put together a thorough application that has the best chance of being accepted.
Working with us is easy. You can speak with our brokers online, over the phone or in person, and we even offer evening and weekend appointments if these times will suit you better. As a customer, you will also get access to your own CLS portal, where you can upload documents relating to your application and track your progress.
CLS Money provide a lot more than just zero hour contract mortgages
Admittedly, finding zero-hour contract mortgages for first-time buyers and those looking to remortgage are some of the specialist areas where we've excelled for our clients, but that's not all. As a mortgage broker, we're here to find mortgage approval for every type of borrower in any situation. We provide mortgage advice for all the situations that the mainstream lenders usual turn away without a second glance.
Unstable or guaranteed income mortgages
More favourable interest rates than your existing lender
Lowering your mortgage payments
Specialist lenders for unique situations
Buy-to-let mortgage options
Mortgages for applicants with bad credit history
Missed and late payments mortgages
Adverse credit mortgages
Tailored advice from your personal mortgage advisor
Probation period or permanent contract mortgages
Self-employed, professional, and other types of contract workers
Minimum deposit mortgages
If you're working a zero hours contract, under probation, a student, self-employed or a contractor, CLS can help you find the mortgage lenders ready to help. We've fount that almost everyone can get a mortgage with enough money coming in to cover the costs.
Most lenders that we work with understand that life isn't black and white, and a few unexpected issues can soon lead us into bad credit. Many mortgage lenders will automatically assume you're a higher risk the minute they spot such things as zero hours contracts, CCJs or bad credit. If we can show them that you've worked hard to change your situation and you're now a low risk, then there's every chance we can find a mortgage deal just for you. We'll even help you beat your current contract, whatever your track record. That's the beauty of working with specialist mortgage brokers – we can track down deals from so many different providers.
Call today, and ask your exclusive mortgage expert about how they can help you. We're specialists in all mortgage subjects, so whatever you need, CLS is ready to help.