Contracted shifts vs salary for mortgage application? Is there a difference?

AndyDufresne

Sorry if this is a stupid question, but if I am paid by the hour (e.g. £10/hour), and I have a contract of employment to work 40 hours per week (giving me £20,800 a year), is this treated the same way as if I was salaried at £20,800/year? Is there a difference that the mortgage lender sees? 

AndyDufresne

Also, what do I put down for the salary field if I am paid by the hour? (rate * 40 * 52)?

K_S

@AndyDufresne Assuming the 40 hours/week is "guaranteed", £10/hour is your basic pay rate, and you are on a permanent PAYE contract, this would be treated as an annual gross basic pay of £20,800 and that's what you put it down as.

yksi

Yes and yes - if it's in your contract. That is, if your contract actually states that you will be working 40 hours per week at £10 per hour, then your salary is £20,800 per year.

If you've been there for years and your contract says 8 hours but you always, always work 40, then welcome to the rubbish world of crappy contracts - your official salary is only £4,160 which is what should go on your application. If this is the case I would recommend you get a broker, who will know which lenders will accept payslips as proof instead of your contract.