Mortgage underwriters and fixed term contracts

Liam942

Hi everyone

I'm a prospective first-time buyer and I went to the bank today to ask about getting a mortgage. I've got a decent size deposit (about 30%), good wages and should have a decent credit history - pay all my bills in full each month, never been overdrawn, small student loan outstanding (approx £6000). I was told that if I was on a permanent contract they would have had no problems, but since I am on a fixed term (3 years) it would have to go to the underwriters. I'm just wondering if anyone could give me an idea of exactly what they will be looking at/for when assessing my application?

Cheers

Liam942

Just to clarify I'm specifically wondering what they will be looking for in my contract - given that even someone with a "permanent" contract my be laid off with only a couple of months notice I'm wondering why it makes so much difference that mine is fixed term?

trulysaintly

Liam942 wrote: »

Just to clarify I'm specifically wondering what they will be looking for in my contract - given that even someone with a "permanent" contract my be laid off with only a couple of months notice I'm wondering why it makes so much difference that mine is fixed term?

It's fairly standard procedure - most lenders have in their lending policy a requirement for fixed term contracts to be referred to underwriters.

Although yours is for 3 years, some are only for 12mths, and in those circumstances the underwriter would want to satisfy themselves that there is a likelihood of you continuing in that role.

As you rightly say it doesn't seem common sense bearing in mind the jobs market, but, this type of lending policy was probably set a while back..