At The Mortgage Clinic, we understand that starting a new job is an exciting time filled with opportunities. It’s a chance to embark on a new career, meet new colleagues, and look forward to a promising future. However, we also recognise that if you’re considering applying for a mortgage, starting a new job can have an impact on your application, especially if you’re looking to purchase a property in Lisburn Road, Belfast. In this article, our mortgage advisors on Lisburn Road Belfast have provided valuable insights into how starting a new job can affect your mortgage application and offer strategies to overcome potential challenges, ensuring a smooth path towards owning your dream property.
Can I get a mortgage with a new job?
Yes, it is possible to get a mortgage with a new job. However, starting a new job can affect the mortgage application process and approval criteria.
Lenders typically consider employment stability and income verification as important factors when assessing mortgage applications.
Here are some factors to consider:
If you are still within a probationary period in your new job, lenders may view it as a potential risk since there is no guarantee of continued employment after the probationary period ends. Some lenders may require you to complete the probationary period before approving your mortgage application.
Lenders require proof of income to assess your affordability for a mortgage. If you have recently started a new job, your income history may not be sufficient to demonstrate your ability to repay the loan. Lenders typically prefer a stable income track record, which can make income verification more challenging.
Lenders consider employment stability when evaluating mortgage applications. Starting a new job may raise concerns about your long-term income stability, potentially affecting your application. However, if you can demonstrate a solid employment history in a similar field or industry, it may work in your favour.
Starting a new job can impact your borrowing capacity. Changes in salary structure, commission-based income, or alterations to employment benefits may influence the amount lenders are willing to lend you for a mortgage.
Verifying Income with Payslips
When applying for a mortgage, providing proof of income is a standard requirement for lenders. Typically, lenders ask for three months’ worth of payslips and two years’ P60 forms. This documentation helps demonstrate your income stability and ability to repay the loan. While some lenders may accept a lower number of payslips, it is less common.
If you have recently started a new job and cannot provide the standard three months’ worth of payslips, it may pose a challenge when applying for a mortgage. However, there are alternatives:
- Waiting Period: One option is to wait until you have been in the new job for at least six months. This allows you to provide the necessary three months’ worth of payslips to prove your income stability. Some lenders may require this waiting period before considering your mortgage application.
- Letter from Employer: In some cases, lenders may accept a letter from your employer confirming your salary and employment details. This letter should be on company letterhead and signed by an authorised representative. While not all lenders accept this, it can be an alternative when you don’t have the required payslips.
- Delaying the Mortgage Application: If possible, you may consider delaying your mortgage application until you have a longer employment history with the new job. Waiting until you have the necessary documentation can increase your chances of mortgage approval.
It’s important to note that each lender has different policies and criteria regarding proof of income.
Working with our mortgage advisors on Lisburn Road Belfast can help you understand the specific requirements and options available to you based on your employment situation.
They can guide you through the process and identify lenders who may be more flexible with your income documentation.
Minimum Job Tenure Requirements for Mortgage Applications
Having a minimum job tenure of three months prior to applying for a mortgage is generally seen as favourable by lenders. Most lenders are cautious when considering applicants who have recently started a new job.
If you have recently commenced a new job, you may not have the necessary payslips to provide proof of your new income. Mortgage providers often prefer applicants who have been in a job for a longer duration as it is perceived as more secure employment, minimising the risk of loan repayment difficulties.
When approaching traditional mortgage lenders, it is possible to encounter application rejections due to their requirement for a longer job tenure. It’s important to note that each mortgage lender has specific criteria, so it is advisable to verify their policies before initiating the application process.
A declined mortgage application can impact your credit report. Therefore, it is crucial to apply for a mortgage only when you are confident that the lender will accept your application based on the duration of your job tenure.
Additionally, mortgage lenders take into account whether your job involves a probationary period, such as the possibility of contract termination within the initial six months. The newness of employment also increases lender caution due to the higher likelihood of newer employees being the first to face redundancies.
Working with our specialist mortgage advisors on Lisburn Road Belfast can be beneficial as they can identify lenders who are more likely to accept your application despite being in a new job. They will consider all relevant information provided by you to find suitable mortgage options.
Changes to Salary
In the event of a salary decrease:
If your new job entails a lower salary, lenders may not be willing to lend you as much as they would have when you had a higher income. The reduced salary can affect the maximum loan amount you qualify for.
If your new job offers additional financial incentives, such as commissions or bonuses, it is important to inform your mortgage lender. Some lenders may consider these arrangements when calculating your affordability, while others may not.
Other factors, including the size of your deposit, will also influence the lender’s decision on the loan amount. Saving up a larger deposit can improve your chances of mortgage approval.
In the event of a salary increase:
If your new job comes with a higher salary, it will positively impact your affordability calculation. This means you may be able to afford a higher-priced property compared to what you could have with your previous lower salary.
Many individuals wait until they secure a job with a higher salary before applying for a mortgage to afford a more expensive house. Some may need to reach a specific income threshold to be able to afford a property at all. Lenders consider various factors, including salary, age, expenses, outstanding debt, and credit history when calculating affordability for a loan.
It’s important to note that each lender has different policies and criteria regarding salary changes and their impact on mortgage applications.
Consulting with our mortgage advisors on Lisburn Road Belfast can provide personalised advice based on your specific circumstances and help you navigate the mortgage application process more effectively.
Seek Professional Guidance from Mortgage Advisors on Lisburn Road, Belfast
When starting a new job, applying for a mortgage or any form of credit becomes more complex. Lenders perceive job changes as a risk and seek reassurance regarding your employment history and income stability. Their primary concern is your ability to repay the mortgage loan over the agreed-upon term.
Whether you’re embarking on a new career or transitioning into self-employment, the most effective way to ensure a successful mortgage application is by consulting with a specialist broker.
To gain insight into how your current job situation may impact your mortgage approval prospects, we encourage you to contact our team of experienced mortgage advisors on Lisburn Road, Belfast. They possess extensive knowledge in assisting individuals with new jobs in securing the best mortgage deals.
Managing Director – Independent Mortgage Broker and Insurance Advisor
Helmut started working in financial services in early 2012 and founded The Mortgage Clinic in Belfast in early 2015. He specialises in all types of mortgages from First Time Buyer, Co-ownership, Self Build, Home Movers, Remortgages, Debt consolidation, to Buy to Let.
Three Best Rated Winner 2021
Winner Mortgage Broker of the year 2020
Top Rated Advisor 2021 on Vouchedfor