Mortgages for temporary workers and agency staff in the UK – Full guide on how to get the best mortgage
Temporary workers may feel that it’s impossible to get a mortgage. However, many mortgage lenders will provide them with a mortgage deal.
It is possible to get a mortgage even if you are on a fixed-term contract. Many lenders offer to finance a temporary worker and an agency worker.
You don’t have to have a traditional income to get a mortgage deal that suits your needs.
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Types of temporary contracts
We’ll first identify the types of “temporary” work and the requirements you need to meet to obtain a mortgage under a fixed-term contract.
A fixed-term mortgage can be obtained.
These contracts are set up with a specific start and an end date that is agreed upon signing the employment contract. Fixed-term contracts may not have a specified period, but they end when a task is completed.
Lenders will often ask for proof of work experience when you apply for a mortgage if your contract is fixed-term.
Temporary workers can get mortgages.
These contracts are similar to fixed-term agreements but are not intended to be permanent. These contracts don’t usually have an expiration date and are subject to change.
Your job title can have an impact on which mortgage lenders will be able to help you, but don’t worry; we have our team of professional, expert mortgage advisors who can assist you.
Short-term mortgage application
Fixed-term contracts are often defined by the duration and nature of a project. They’re pretty different.
A track record of success in your job is a significant advantage if you are looking to obtain a mortgage for a temporary contract.
Any mortgage lender will likely require evidence of your experience.
Worker probationary period mortgages
Employees who start new jobs are often subject to probation periods. They are typically for six months. Some only three months. Some can last up to 12 months.
While probationary periods can be problematic for many lenders, some lenders will accept the risk and offer a mortgage with a probation period. However, this can vary depending on the industry sector and requires confirmation of employment beyond that date.
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Is it possible to get a mortgage under a fixed-term agreement?
A fixed-term contract will not prevent you from getting a mortgage.
Lenders will require evidence of regular income to be approved, so to reassure lenders that your income is consistent with self-employed borrowers, they will require you to prove it.
As long as you’re ‘in work’, alternative employment contracts can still be used to prove affordability. However, some lenders may require you to meet specific criteria, like being in a contract for at least six months.
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Temporary contract mortgages:
Lender criteria
Lenders will search for different things to obtain a mortgage. Many have different requirements you have to meet.
Why are lenders not interested in fixed-term and temporary contracts
Some lenders may view these types of contracts as not guaranteed income, which could pose problems in terms of affordability, they are ultimately assessing risk.
Our specialist mortgage brokers will help you find mortgage providers that can accommodate any worker on a current contract, not just those in permanent jobs.
Get started onlineYour job description
This is a question that every mortgage lender will ask because it can impact your eligibility to get a fixed-term mortgage.
Based on the skills and qualifications of the person, some roles are considered more stable than others.
For example, those who are less skilled and labour-intensive, such as those working in construction or warehouse operatives, may find that there are fewer opportunities than those with higher skills (i.e. solicitors and teachers are professionals.)
Higher-skilled roles will be able to take advantage of more flexible financing options. The usual rules for short-term or temporary contracts may often be less restrictive.
The length of your current contract
People on short-term contracts may have difficulty securing mortgages from lenders and banks. Lenders will need additional information about your employment contract to discuss your options for borrowing.
As mentioned above, most temp workers can be flexible about the length of their contract.
Lenders will typically require that your contract is in place for at least six months, even if it is short-term. However, some lenders may require 12.
Lenders will consider granting a mortgage to someone with a temporary job even if three months remain on an employment contract. Other specialists, however, would not approve of any longer than six months, as long as the contract was valid when it began.
Lenders may request employment history evidence that you have worked in the same position for another employer for at least two consecutive years if you are in a casual job with no fixed term or defined employment. This will allow them to make an informed decision on your work history.
Is your contract still valid?
Lenders will lend less than the remaining months of your contract if your contract has been renewed with your employer at least once. Official renewal confirmation is also acceptable if no months are left on the contract.
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Time spent in your current job.
How long you have been employed as a fixed-term contractor employee will also affect your ability to obtain a mortgage. Again, these criteria can vary from lender to lender.
Lenders may require that your current position is for at least 12 months.
Others may require that you serve at least six months. Some lenders will allow for no less than six months. However, as long as you have been in the same role, it is acceptable.
Your relationship with your current employer/agency
Temporary workers employed for less than 12 months with the same company or agency can pose challenges to lenders. Some may decline your application.
Many will approve your application if you have worked in the same job for twelve months.
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Are there gaps in the employment market?
Are you currently in a transitional period, and have there been gaps in your employment history over the past 12 months? This may be a problem for some lenders, but others will not accept gaps in the last 6 to 3 months.
Some lenders will also allow gaps as long as the income is stable.
Individual cases are determined based on specific merits.
Lenders may define “gaps” differently. This can affect your borrowing eligibility. Some lenders define a “gap” as no work for at least one week, two weeks or four weeks.
This shouldn’t be a problem as long as there is an explanation. Many lenders will consider granting a mortgage under a fixed-term contract, even if you don’t have a regular job.
What amount could I borrow if I have a fixed-term contract?
Like all mortgages, the criteria for eligibility (up to 95%) and affordability (up to 5x your income) will remain the same. These factors will determine your eligibility and how much you are eligible to borrow.
Specialists or adverse lenders are more flexible regarding temporary income than high street lenders. They usually require a minimum of 12 months in your current job, with as few gaps as possible.
Fixed-term mortgage applications often have stricter criteria for agency temp workers and those in fixed or short-term employment contracts.
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Need help getting a mortgage using a temporary contract?
These quick and easy tips will help you be prepared.
- Credit cards are a great way to build credit responsibly. You can use them to purchase things and then pay them off monthly with your earnings.
- Keep a record of your work history if you have worked with your temp agency/employer for less than six months.
- Many lenders will tell you to save as much as possible to lower your maximum LTV requirements. You don’t have to deposit a lot, and one of our advisors will be able to talk with you about this.
Talk to an expert about how to get a mortgage.
We work with specialist lenders who offer a mortgage to agency and temporary workers daily.
The mortgage lenders we work with will offer you the best mortgage deal on the market in the UK.
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