Employed as a councillor, but no 'contract', mortgage help

masseyattack

Hi,

I'm hoping to get a small mortgage on a new build property, but my main concern is that the lender will ask for a contract of employment. I'm currently a unitary authority councillor, and as such I am elected every four years (I have 3 years left), but we do not sign formal contracts.

I can get a letter from my HR department saying this (and adding that essentially I cannot be removed from my job until 2019 unless I go to prison!), but would this suffice in a lender's eyes. It's a strange situation which I imagine won't occur all that often!

Edited to say: My partner who will also be on the mortgage does have a permanent contract in the NHS.

ACG

Is your income needed for the Mortgage?
If not you could put your income down as £0?
If it is, then you need to find a lender who will accept it. For that you either need to start making phone calls to lenders or speak to a broker. Like you say, it is not the norm and so it is best to do the ground work before making an application anywhere.

masseyattack

Hi, thanks for the reply ACG.

My income is needed for the mortgage, yes. I have included my details below if it helps.

I've spoken with London and Country today who said they don't think it will be a problem as I've got so long left to run (until May 2019), but I was hoping for something more concrete than that. They basically said they think I'm eligible but would start ringing round after I've put a reservation fee down. Luckily the fee is only £99.

House price: 135000
Help to buy equity loan: 27000
My deposit: Up to 40k
My salary: 20000
Partners: 12000

ACG

I do not do Equity loan mortgages so not entirely sure on the lenders available. Personally I think it is achievable, but whether its achievable on HTB I am not sure.

Kingstreet (a member on here) is probably best placed to answer this. Who do you have to pay £99 to?

masseyattack

Thanks for your advice and comments.

Taylor Wimpey is the house developer so the £99 is to them.

I've passed every financial/credit check Taylor Wimpey have asked for (and that L&C asked for). It was only when the L&C broker mentioned as a next step he'd need payslips (which I have), and a copy of a contract (which I do not in the traditional sense) that got me worried. Again, he said he think it'd be fine, but he would ring round lenders after I've put the reservation fee down. As mentioned earlier I can get the Chief Exec/Chief Lawyer to explain my job/salary in a letter - and I have evidence of this income for the last 5 years -, it's just whether a lender would accept this.

ACG

Why are L&C interested in whether or not you pay a fee to Taylor Wimpey? Was it Taylor Wimpey who suggested you speak to L&C?

Your broker should be working for you, nobody else. Their interests should be aligned with yours, not their introducers. I would either get them to confirm they do have lenders who are happy with your contract and circumstances (ie HTB EL) or find a new broker.

masseyattack

No Taylor Wimpey didn't suggest them they suggested their own 'partners', whose rates are worse than those L&C could find.

So your advice is essentially make L&C or another broker check that they have lenders who would be happy with my contract before continuing with a reservation, I think

ACG

It would not cross my mind to suggest you pay the £99 fee. There could be valid reasons for it if L&C are suggesting it and not tied to them in anyway.

New builds are not really my bag, there are not too many developments where I am based so do not hold me to anything as I could be completely wrong.

masseyattack

Thanks again for your comments.

The £99 is just to reserve the plot essentially and then I have 28 days to get everything sorted. There are only a handful of houses left on the development so I want to pay this asap.

Maldives_lover

You shouldn't have any problems getting a mortgage, your allowance should be taken into consideration.