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Contract staff - problem getting a mortgage - Another good reason not to go into rese

I hope someone has some advice for me.

I am a researcher at a university. Like many people who do this job, I'm on a fixed-term contract. I move from contract to contract - but because of the way research is funded, I don't have a perm' job. Also - for my career I move between universities (I go where the most relevant stuff to me is) - so I change employers.

The problem is that I can't get any of the "standard" lenders (here I'm thinking of big, reputable banks and lenders - such as NatWest, Co-op) to even talk to me - I don't get past their screening questions for a mortgage. Unfortunately, my husband works in the same type of career.

What do we do? Would you even bother speaking to people like Freedom Finance? Would it help if we got a parent to go guarantor (spelling is not my strong point!)?

It would be great to hear people's experiences - particularly if they are contract employees!

Thanking in advance.
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Comments

  • luckyfool
    luckyfool Posts: 1,683 Forumite
    What position are you in with regards to a deposit, purchase price etc? There are some lenders that will take a more flexible approach depending on other aspects of your circumstances.
  • TEDDYRUKSPIN
    TEDDYRUKSPIN Posts: 1,528 Forumite
    What is your track record in jobs in the uni? Is it the first time you got a job? How long is your contract? Are you a post doc?
    To be honest you should not have a problem. You are actually going into the wrong banks. You mentioned you have been into big lenders? Who are they?

    I know two in particular who will give you a mortgage but depending on deposit.
    Motto: 'If you don't ask, you don't get!!'

    Remember to say thank you to people who help you out!

    Also, thank you to people who help me out.
  • olly300
    olly300 Posts: 14,738 Forumite
    Part of the Furniture 10,000 Posts Combo Breaker
    As a contract worker I suggest you use a independent mortgage broker as they will show you the lenders who will lend to you.

    However if you don't have a reasonable deposit particularly now then forget it.
    I'm not cynical I'm realistic :p

    (If a link I give opens pop ups I won't know I don't use windows)
  • Thanks for the comments so far. I'm moving into my second post-doc contract - this one is for 2 years in the first instance, with the plan to extend for another 3 - 5. We have a 10-15% deposit, good credit rating. I will try an independent mortgage broker and will carry on trying other banks. When the first couple said no go because contract work, I did get very disheartened so thanks for your advice. If any one knows of particular banks who are amenable to contract staff that would be great.
    Thanks - it's good to hear from people with more experience.
  • I'm on a contract and HSBC have agreed to give me a mortgage. You have to go into a branch though, not do it over the phone.
    Live on £11k in 2011 :D
  • I know lots of postdocs who have had no trouble getting a mortgage, even those with less than 2 years to run on their contract. Of course, the banks have been tightening up their criteria so maybe lender's attitudes have changed. Or, it may be that only having a 10% deposit is the issue here.

    Good luck with it- I've been a postdoc (thankfulyl have a permanent job now) and know how rubbish it is having to exist on fixed term contracts.
  • Hi
    Thanks for the advice so far. The problem is the contract side of things as far as I can tell (the deposit just seems to mean a more expensive mortagage).

    I've spoken to a couple of brokers and when I tell them I'm on a contract, I'm immediately told things get much harder!

    Having talked with some people at work who are also contract staff and on contracts - a couple have told me simply not to tell the mortgage advisor it's a contract, unless they ask. One told me that it is the lender's responsibility to ask and if they don't ask I don't have to tell. This makes me extremely uncomfortable - it seems dishonest - but what do you think? I always tend to be a bit of a nice-but-dim honest person - am I wrong in this case?

    Thanks for everything so far.
  • Joe_Bloggs
    Joe_Bloggs Posts: 4,535 Forumite
    Does it make any sense to take out a mortgage on a depreciating asset ? Further on you may have to try to sell this asset to move to another post. This may put you into a negative equity situation.
    It is the temporary nature of the short term funding that is the issue behind the difficulty.
    Perhaps their should be a pool of housing that researchers could move between, made available by their employers.
    J_B.
  • I had the same sort of issues when I first left the forces, all the work I was involved in was contract work.

    In the end my partner and myself opened up bank accounts with First Direct and ran the accounts for 6 months so they were aware of incomings, outgoings etc.

    They offered the mortgage without any major issues or major costs.
  • Joe_Bloggs wrote: »
    Does it make any sense to take out a mortgage on a depreciating asset ? Further on you may have to try to sell this asset to move to another post. This may put you into a negative equity situation.
    It is the temporary nature of the short term funding that is the issue behind the difficulty.
    Perhaps their should be a pool of housing that researchers could move between, made available by their employers.
    J_B.


    Maybe they should be a pool of housing but there isn't and so that's that.

    The issue of whether it's sensible to take out a new mortgage at all now is an over-arching point - will property prices recover in the next 2 years? Personally, our plan is to stay in the area to get new contracts (indeed, the purpose of my current contract is partly career development to push me into a 5 year contract afterwards).

    I'm hearing a lot of people saying that property prices will have recovered within the next couple of years - hence our desire to get on the ladder at this time - when we hope to be able to buy cheap and sell for a little more in a couple of years. Are we mad?

    If we're not mad, then the issue of actually obtaining the debt comes back! What do we have to tell potential lenders? If they don't ask about the type of job we have, do we have to tell? As I said, I've spoken to some people on contracts who were never asked by their lenders so never told - but is that strictly legal and above board?

    I'm learning lots as I go on and thank everyone for their on going comments.
    Best
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