September 25, 2017
More and more often we are seeing people change jobs and careers frequently so the question stands; will it affect your chance of buying a house?
With statistics showing the national average of time spent in a job is 3.3 years across all age groups, it is important to consider lenders criteria if you are applying for a home loan and you have recently changed employers.
How does a new job impact my application?
For all applications but especially the younger applicants a stable job can be critical when your application is being assessed by the lender. They look for secure income and stability when deciding on your capacity to borrow. Lenders will usually look at how often you change jobs, your time in each role, whether or not you are changing industries with each job and if your move was taking your career in a new direction. You may love your new job but your bank might not feel the same way.
How long do I need to be in my current role?
While most lenders will look at your last 2 years of employment you do not necessarily need to be in the same role for this time. The lender will be looking for steady or increasing income over this time.
Most lenders require you to be in your current role for at least 6 months and a minimum of 12 months for casual employment however there are some lenders who will approve you even though you have just started a new role but you will probably need experience within your industry for this to happen.
What if I am changing my career?
If you are looking at changing your career path or have recently changed employers for the same career it does not necessarily mean you will not be approved for a home loan.
Most lenders understand that many employees within todays job market are highly skilled and thus in high demand and are always looking for an opportunity to further their career. This means a lot of employer changes come about due to higher salary or better working conditions being sought.
The length of time in a role can also be less of an issue when the applicant has other forms of income that are expected to continue for the foreseeable future. This can come from sources such as investment or a second job.
What else should I consider?
The best way to avoid issues when applying for a home loan is to ensure the rest of your application is strong so your employment period may not be so much of an issue. The amount of savings you have, what assets you hold, the credit limit of your liabilities and your general living expenses are some of the things lenders will look at when assessing your application.
What do I do now?
Talk to us! The team here at Mortgage Choice Gold Coast South & Northern NSW would love to help you achieve your goals. Book an appointment with us today to discuss your options and get you on your way to owning your home.