Getting a mortgage on 0 hour contract?

laurajanelolly

My partner and I are looking to buy our first home together soon but may have encountered a problem.

I'm a full time college lecturer but my contract is technically a 0 hours one. This is now an extremely common thing in further education. The majority of my department are claims lecturers, like myself, sold a false impression that teaching is a secure career. In fact I have the most contact hours out of the teachers in my curriculum area but that could all change come September due to my "0 hour contract.' This is due to funding cuts by the government and a shrinking demographic of teenagers that means given hours change year on year.

My current dilemma is how can I apply for a mortgage with my partner if in the eyes of the lender I don't have a stable income? There are teachers where I work that have been on these fluctuating contracts for years and in the current climate are still unlikely to see change.The only salaried teachers are those that have been there for 6 years plus and even then they had to fight for them. I've only been there a year so am guessing there is no hope anytime soon and jobs in my area are so thin on the ground I couldn't get one anywhere else.

Has anyone been in this situation or knows a way around it?

RhysHSCC

Its an unfortunate situation and I sympathise.

Is your partner on a 0 hour contract as well? If not, and if he is the majority earner in stable income, it might mean they will do an affordability assessment on his income alone. So there may be some hope yet

laurajanelolly

RhysHSCC wrote: »

Its an unfortunate situation and I sympathise.

Is your partner on a 0 hour contract as well? If not, and if he is the majority earner in stable income, it might mean they will do an affordability assessment on his income alone. So there may be some hope yet

He's on salary but I earn slightly more, although he gets bonus and I have higher deductions due to student loan and high rate pension. Probably around the same to be honest. We were looking at doing a 5% deposit on a help to buy but now wondering if a larger deposit would be more in favour, this would be hard to get though.

RhysHSCC

It sounds like to get the mortgage you're after, your income will need to be included to get the level of borrowing you want from an affordability assessment point of view.

Bigger deposit may help, have you looked at any lenders affordability calculators based on your partners income alone? It might be worth trying just to get a rough idea of what they could lend him with the bigger deposit.

laurajanelolly

Affordability calculators won't have none of it unless the deposit is sky high which is never going to happen. We live in the south so property is fairly pricey. Such a same to spend so much on an education to get a good career yet still be penalised. Silly government!

I might look at smaller lenders and brokers like the teachers building society as they may consider this more freely. Might also get onto the union at work to see their suggestions as they must deal with this often.

RhysHSCC

Broker might be your best bet, as they will have a wider knowledge of who is likely to accept 0 hour contracts. It might end up with you having to provide more evidence of your income over a longer recent history (annoying I know, but worth it)

Wish you the best of luck in your searches!!!

amnblog

Hi Laura


If you have a 12 months track record on your zero hours contract a good broker should potentially be able to sort this for you.


On a political note: having a lecturer on a zero hours contract tells you a little about what we are getting so wrong in this country.

laurajanelolly

Thank you I will take a look at this route. My contract renews again in August so may wait till after to ensure my hours.

On that political note: the irony is I'm currently teaching a unit about employability and careers! :mad:

Richard019

It's a slightly different thing, but when I got my first mortgage deal I was on a 25 hour contract, but working 40 hours a week with the extra 15 in unguaranteed but regular overtime. When it came to calculating my income for working out what I could borrow they took the 25 at full value, and counted the extra 15 at half value to give me a total of 32.5hours.

On a zero hour contract I would expect (from a logical rather than experience perspective) them to treat all your hours the same way as they did my overtime, as your hours are all essentially regular but not guaranteed overtime. So if you can show how many hours you worked this year you'd hopefully be looking at them using your other half's income in whole, and at least half of your income.

leveller2911

amnblog wrote: »

Hi Laura


If you have a 12 months track record on your zero hours contract a good broker should potentially be able to sort this for you.


On a political note: having a lecturer on a zero hours contract tells you a little about what we are getting so wrong in this country.

With the up and coming EU referendum we often hear from the pro EU lobby of how the EU has protected/increased workers rights especially from the Labour party (who want to remain) but they haven't prevented zero hr contracts which are a disgrace imo.

I'm not sure why its any worse that a lecturer is on a ZHC than a manual worker.