Getting a mortgage on a zero hours contract is possible, but not every lender assesses zero hours income in the same way. If your hours and income vary, finding a mortgage can be more complicated than for someone with a standard permanent employment contract.
Premier Mortgage Services can help if you work on a zero hours contract and are looking to buy a home, remortgage or move house. We can assess your circumstances and identify mortgage options that may be suitable for your income and employment history.
Can I get a mortgage on a zero hours contract?
Yes. Being employed on a zero hours contract does not automatically prevent you from getting a mortgage.
The main issue for lenders is usually the reliability and sustainability of your income. Because your employer does not guarantee you a set number of hours, lenders may want to see evidence of your earnings over a period of time before deciding how much income they can use for affordability.
Some lenders will consider zero hours contract income where you have a consistent employment history and can provide sufficient evidence of your earnings. Other lenders have more restrictive criteria, so the choice of lender can be particularly important.
How do lenders assess zero hours contract income?
Lenders have their own criteria for assessing income from zero hours contracts. Some may look at your earnings over the previous 12 months, while others may use different periods or have specific requirements depending on your occupation and circumstances.
For example, published lender criteria can require at least 12 months of sustainable earnings on a zero hours contract. Some lenders may use an average of your previous earnings rather than simply looking at your most recent payslip.
This means that having a consistent work history can be important when applying for a mortgage on a zero hours contract.
How long do I need to be on a zero hours contract?
There is no single rule that applies to every mortgage lender.
A number of lenders require around 12 months of employment or income evidence, although some have different requirements. Your previous employment history may also be relevant, particularly if you have recently changed employer.
If you have only recently started working on a zero hours contract, your mortgage options may be more limited. However, it is still worth assessing your circumstances because lender criteria differ.
What documents will I need?
You will normally need to provide evidence of your income and employment. Depending on the lender, this could include:
- Recent payslips
- Your latest P60
- Bank statements showing your income
- Evidence of your employment history
- Your employment contract
- Details of any additional income
The exact documents required will depend on the lender and your individual circumstances.
Can I get a mortgage if my income changes each month?
Potentially. Variable monthly income does not automatically mean you cannot get a mortgage.
The important factor is whether your earnings can be demonstrated over a sufficient period and whether the lender is comfortable that the income is sustainable. A lender may use an average of your earnings rather than relying on a particularly high or low month.
If your income has been relatively consistent despite your hours changing, this can help demonstrate your ability to maintain mortgage payments.
What if I have more than one job?
Some people on zero hours contracts have more than one job to maintain a consistent level of income. Depending on the lender, income from additional employment may be considered as part of your mortgage application.
However, lenders have different rules around second jobs and multiple income sources. We can look at your complete income rather than assessing your zero hours contract in isolation.
Zero hours contract mortgages for NHS and care workers
Zero hours contracts are used across a range of industries, including healthcare and care work. Some lenders have specific criteria for NHS bank staff, locums, care workers and other occupations where variable hours are common.
This can include situations where your income comes from bank shifts or other variable working arrangements. The way this income is assessed will depend on the lender and your circumstances.
Can I get a mortgage with a small deposit?
Having a zero hours contract does not automatically determine how much deposit you need. However, your deposit, income, affordability and credit history will all form part of the mortgage assessment.
A larger deposit can reduce the amount you need to borrow compared with the value of the property, but it does not remove the need to demonstrate that the mortgage is affordable.
Why use a mortgage broker for a zero hours contract?
Applying to the wrong lender can make obtaining a mortgage more difficult when your income does not fit a standard employment pattern.
A mortgage broker can assess your employment and income circumstances before identifying lenders whose criteria may be appropriate. This can be particularly useful if your hours vary significantly, you have recently changed jobs or you have more than one source of income.
Contact Premier Mortgage Services to discuss your circumstances and find out what mortgage options may be available to you.
Get zero hours contract mortgage advice
If you work on a zero hours contract and are considering buying a property or remortgaging, Premier Mortgage Services can help you understand your options.
We can look at your employment history, income and deposit and help identify mortgage options based on your individual circumstances.
Contact Premier Mortgage Services to arrange an initial discussion about your mortgage requirements.
