How to Get a Home Loan with Unusual Employment or Income?

Since the Covid Pandemic an increasing number of people are choosing flexible working opportunities to successfully combine both their lifestyle and their income commitments.

However, many home loan applicants have found that their bank is apprehensive towards them and it is because of their irregular working hours. They don’t seem to fit into the strict lending guidelines set out by banks and they are not seen by banks as holding down a stable employment with regular income.

A Non Conforming Lender will be familiar with the lending guidelines and credit policy requirements of a number of non bank lenders/credit providers who will accept Unusual Employment and Income with a Near Prime Loan.

What are the Common Unusual Employment and Income Types?

Below are some of the common unusual employment and income types:

PAYG (pay-as- you- go) contractors

Casual workers or Second Job

Part-time workers or on Probation

Self-employed individuals

Sub-contractors

People with other forms of income

Type 1 – PAYG Contractors

PAYG contractors are employed via an agency or directly via their employer. This form of employment is now common in a variety of fields such as:

Medical

Teaching

Engineering

IT (Information Technology)

Mining

Project Management

Construction

Government

If you are a PAYG contractor and you are looking for a home loan here is a list of things that lenders/credit providers will require you to provide:

You will be required to provide a copy of your most recent “Employment Contract”, with income details listed and you will need to provide evidence that you have had employment in the same industry and that you have a good track record in your chosen industry.

You will need to provide evidence that your employer or employment agency takes care of your income tax and superannuation contributions for you and show copies of latest pay slips.

Note: If you are not on the direct payroll of an employer or employment agency, you may be treated as being self-employed.

Type 2 – Casual Workers or Second Job

This type of employment applies to people working on a casual basis in the following industries:

Restaurants

Retail

Teaching and Tutoring

Nursing

Childcare

Trades

Drivers

Cleaners

If you are a casual employee, you will generally need to provide evidence that you have been employed at the same place or industry.

Type 3 – Part-Time Employees or on Probation

If you are employed on a part-time basis or on Probation you will find that non bank lenders/credit providers will generally require you to:

Provide evidence that you have been employed at your current employment for at least 6 months

Provide copies of a computerised pay-slip covering a minimum of two (2) pay cycles in order to confirm details of your base income and a signed letter of employment from your employer listing details of your current base-remuneration.

Type 4 – Self-Employed Individuals

You are categorised as self-employed individual when you are paid through your ABN even when you are conducting freelance work as a journalist, photographer, tour guide, etc. In such a situation, you will find that most Banks will require you to provide evidence that you have a regular income to sustain a loan. This includes providing evidence that you are a business owner or partner and you have been trading in your current business for at least 24 months.

For a Prime Bank Loan you will be required to provide copies of your most recent Personal and Business Income Tax Returns and business financial statements, reflecting two (2) years trading activity.

For a Non Prime Bank Loan you have a Low Doc Home Loan option for Self Employed Australians where you can supply a declaration of income with either:

Accountants Declaration of income

6 months of lodged BAS statements

6 months of Business Bank statements

Note: If you conduct freelance work with an employer, you may find that lenders/credit providers may require you to provide a copy of the written agreement between you and the employer that outlines your pay and conditions.

Type 5 – Sub-Contractors

Sub-contractors have specialized skills and they are generally employed by a primary contractor to provide specialized services in a variety of fields such as:

Building and Construction

Mining

Civil Engineering

IT (Information Technology).

Note: Many sub-contractors have little to no overheads and no staff and most are typically self-employed. In a sense they are similar to PAYG contractors.

Type 6 – Other Forms of Income

If you receive other forms of income and you are unsure if it is acceptable you should seek help from a Specialist Mortgage Broker. These other forms of income can include:

Centrelink payments and Pensions

Commissions and Bonuses income

Trust Distributions income

Car /Shift and other Allowances

Annuity Income from Superannuation

Director’s fees

Second Job income

Investment income (i.e. Dividends received from publicly listed companies)

Child Support Court Ordered Maintenance payments

Salary Sacrifice

Foster Care Income

Superannuation Income (Pension or Annuities)

Trust Distributions

Oversease Income

Maternity Leave

Seek Expert and Professional Advice

If you still have doubts regarding your employment status and want to obtain a Home Loan you can seek help of an experienced mortgage broker or Non Conforming Lender because they will have experience of dealing with many non bank lenders/credit providers on a regular daily basis.

Manage your Debts by Refinancing your Current Home Loan

A Debt Consolidation Home Loan can Help you take Control of your Finances

Are your debts getting out of hand and you want to take control of your finances? If you have answered yes, you should consider the possibility of refinancing your current home loan and combining your multiple debts with a debt consolidation home loan (e.g. credit cards and other personal loans) into one home loan.

How does the process of Refinancing My Home Loan to Consolidate My Debts work?

You simply consider applying for a new loan on your current property and you use this new loan to pay out your current home loan and any other debt you may have (e.g. higher interest credit cards or personal loans)

How Can I Benefit by Refinancing My Current Home Loan and Consolidating My Debts?

You too can benefit in the same way that many Australians are already benefiting by refinancing your current home loan. This will enable you to:

Lower your monthly repayments

Make only one repayment

Lower your interest rate

Reduce the amount of time it takes to pay off your home loan

Get yourself back in control of your debts much sooner than you anticipated

You will not have to experience the stress and pain of overdrawn or over the limit credit card balances

Reduce your debts (including eliminating high interest credit card debt and personal loans)

You will not have to pay the higher credit card interest rates anymore

Who can enjoy the Benefits of Refinancing?

Refinancing may benefit you even if you fit into one or more of the following categories:

Irregular income

Short-term employed or not employed long enough

Self-employed

Previously bankrupt or Part 9

Declined by another lender

Bad credit history

Existing loan arrears or defaults

What Should I Consider When I Am Applying for a Refinance Home Loan?

Make sure, the refinancing and debt consolidation process is beneficial to you. I suggest you to consider the following outcomes at the time of applying for a refinance home loan and confirm in your own mind, if the outcomes are to your benefit:

You are kept fully informed

Your repayments will be reduced – not increased

There are no hidden fees or costs

You have achieved control over all your debts

There is a real long term benefit to you

Not all lenders allow equity release to consolidate debts contact a Debt Management Mortgage Lender

So, don’t spend your money in making high monthly repayments. Take full control of your finances and contact a debt consolidation specialist who will provide you with expert advice on refinancing your current home loan to consolidate your debts.

What is a Caveat Loan?

The Meaning of a Caveat Loan

Caveat loans are a short-term asset based loan product usually financed by private lenders. Compared to conventional forms of finance, a caveat loan can be established quickly (i.e. within 24 hours from the time the loan application is first lodged). The loan is secured on the value of concrete assets, such as:

A house or unit

A block of land

A commercial property

The Purpose of a Caveat Loan

For a business owner or a property developer it is inevitable that you may find yourself needing money quickly. So, a caveat loan is the right loan for you as it will enable you to:

Commit to any potential business growth by providing you with the required increased working capital

Secure the required funds for construction or development projects (Secure the required funds for property development or construction projects)

Get the cash-on-hand you need for urgent bills and expenses

Enhance your day-to-day business cash flow

Prevent foreclosure or repossession of your property

NOTE: – It is important to note that caveat loans are not offered to consumers who seek to use the funds for purposes to which the National Consumer Credit Protection (NCCP) Act may apply. The loan facility can only to be used for business or for investments other than investments in residential property.

Features of a Caveat Loan

Features for you to consider when you are applying for a caveat loan:

Fast approvals to meet your immediate needs

Quick settlements

Loan terms up to 3 > 12 months

Security to be in the form of real estate

Loan repaid at the end of the agreed term

Approval Requirements for a Caveat Loan

To get approval for a caveat loan, the lender/credit provider will require you to have:

Accessible equity in owned property (e.g. your residence or your business)

A reasonable exit strategy in place. You must be able to show the lender/credit provider how you plan to pay back your caveat loan (e.g. you may decide to sell the Security or use the profit from the sale of a business)

Do not worry if you have Bad Credit History

If you are in a situation where you need a loan and have a bad credit history, do not worry. Because generally credit checks are not required to be performed on caveat loans, even if you have:

A Discharged Bankruptcy

A Bad Credit Rating

A Court Judgement

A Part-9 Debt Agreement

Find an Expert Non Conforming Broker to help you

Contact a reputed brokerage firm with access to numerous private lenders /credit providers. The firm’s professionally qualified and expert finance brokers will structure your caveat loan to suit your individual needs and budget.

How To Save Money Buying A House

Buying a new home is a significant investment that can sound scary sometimes. But, it is also a relatively safe bet, and it could even help to boost your retirement savings. However, if you play your cards right, you can get your home at a much more affordable price. While getting a good deal is very important, there are a few other factors at play that can save you money in the long run.

Shop For An Affordable Mortgage Rate

Mortgages are very important, and the rates vary from lender to lender. So a great way to reduce your cost is to shop around a bit for competitive rates for investment home loans for up to five firms.

Also, it would be of great help if you learn about the options available to you. For instance, a shorter loan term might mean higher monthly fees. Most importantly, ensure you have options, so you don’t feel trapped when making a choice.

Use An Experienced Agent

This might sound counterproductive as agents cost money. However, they also come with years of experience, and if you get a good one, they’ll ultimately save you money. This is because they will negotiate a great deal and protect you from unnecessary costs that you might have never heard of.

Get A Fresh Pair Of Eyes

Finding the perfect home is a collective effort that could involve your family and friends. For example, you’ve just been shown a lovely home and are over the moon. Stop for a second and call a friend or family member to also look at the house as they are more likely to point out defects that will cost you more money.

Improve Your Credit Score

The simple rule is that the higher your credit score, the lower your loan will be. This obviously means you stand to gain a lot if you have a better credit score. You can improve your credit score in several ways, including paying your credit card balance, and so on.

Find A Home In Need Of Maintenance

Everyone wants to buy a lovely house with all the upgrades and curb appeal. On the flip side, it means you can snag a great deal on a home that needs some work. This method is tricky as you need to balance the cost of maintenance necessary with the amount you’re saving.

So, if the work required is too much, it might be best to turn away. Finally, putting some work into the house and subsequently creating a masterpiece gives you a sense of pride (along with some money to spare)

Conduct Your Own Inspection

Agents can sway you with lovely words, and inspectors might not always tell you everything, so you’ll need to look out for yourself a bit. This means paying close attention during the house inspection and even taking notes if necessary.

Also, you can tag along with the inspector and take a look at a few things yourself. Who knows, you might find something that turns you off and potentially cost you money you don’t have.