How Does Your Income Stack Up?
Long gone are the days when people stayed at the same permanent fulltime job for their lifetimes. The current employment market looks a lot different. It is common for people to change employers regularly and we see many people are employed on a contract or casual basis. Some find they need to have more than one job, including those operating a “side hustle”, meaning they are working in a salaried position and running a business on the side.
They way lenders treat income can vary. This is particularly the case with the current lending market being tighter, so it is important to understand how lenders view your situation. Not all income is treated equally so you need to know whether you can count all of it towards the servicing of the loan or whether some needs to be excluded. For example, a lender may only include 50% of the income for a second job, or you may need to be in a position for a specific period. Government payments are also treated very differently from lender to lender.
Your mortgage broker will know what income is acceptable to what lender so discussing your scenario with them before you proceed will make the process smoother for you. If you do have irregular income, a broker can help you access lenders who are more than happy to consider this. In many cases the only way to access those lenders is via an accredited mortgage broker. If your case fits within mainstream bank policy a broker can also help you navigate the best solution for you.
Making too many applications can adversely affect your borrowing capacity, so you want to try and get it right the first time. Every time you apply for a credit facility it leaves an imprint on your credit file so it is important to understand the impact this has. Your mortgage broker is a great ally to help ensure you have the right lending approach from the outset. This is particularly so if you need to borrow over 80% of the value of the property and you require lenders mortgage insurance.
Before you go looking for your next home loan, give a us a call to see how we can help you, whatever your income situation.