Mortgage for Fixed Term Work Contract

Is a temporary worker able to get a mortgage? With a short-term contract, will a bank consider you for a mortgage? It can be more challenging, and lenders prefer individuals with a steady job, but a mortgage with a fixed term employment contract is still possible.

Mortgage lenders seek out stability when making their decisions and try to avoid any potential risks or uncertainty. They tend to be hesitant about dealing with individuals who are working on a fixed-term contract due to the inherent volatility of such a job. However, with the right steps, industry-specific advice and guidance, and proper documentation with a strong application one can navigate the process and avoid the pitfalls one might otherwise encounter!

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How to get a mortgage on a fixed-term employment contract?

The first thing you should know about fixed term contract mortgages is that lenders prefer to work with less risky borrowers with a consistent and predictable income.

Since the lenders will assess you based on your ability to make timely payments, you need to appear to be a more secure investment. The following steps will improve your situation:

  • Present Fixed Term Employment Contract Copy: A mortgage lender can determine the stability of your existing income and the duration of your current work.
  • Copy of past employment contracts: They showcase your employment and income consistency.
  • Providing updated accounts: It helps you provide proof of your financial stability despite contractual employment.
  • Securing larger deposits: The larger deposits reduce the risks for lenders and thus improve your chances for mortgage approval.
  • Better credit score: To raise your credit score, you might use an existing credit card and fully make your monthly payments. Nonetheless, it is not advisable to apply for new credit cards.

How much can fixed-term contractors borrow?

Usually, mortgage lenders will allow you to borrow up to 4.5 times your annual salary, but up to 5.5 times might be possible. In addition, you will be required to pay a deposit equal to a portion of the home's value.

The loan-to-value (LTV) ratio measures how much you're borrowing compared to how much you pay upfront. Mostly, mortgages for people on fixed term contracts get a maximum LTV of 80–90%. In other words, you'll deposit 10–20% and borrow 80–90% of the house's worth.

At Davidson Deem, we understand the challenges with mortgages for people on fixed term contracts, through employment agencies, or in the "gig economy". We can also look to assist if you earn your income through your own ‘shell’ limited company. Why not contact our team on 01202 884111 today?

You can also e-mail us at for complete guidance regarding fixed term contract employment mortgages.

Yes, you can change jobs after your loan is approved (but before it is drawn down) but some lenders may mandate you to report the job change. It is advisable to collaborate with an experienced mortgage broker to submit a solid loan application and have a higher likelihood of being approved.

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