Full time to gap year to casual

Discussion in 'Loans & Mortgage Brokers' started by Angelar, 9th Sep, 2018.

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  1. Angelar

    Angelar Active Member

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    It doesn’t appear we’ll have any servicing issues, but after being in a job for over 10 years, I took a gap year (unpaid) from a full time role, after exhausting all paid leave, and have literally just returned to the same company and role, but now on a casual basis.

    I need to borrow ASAP for a 50% LVR OO P&I, but concerned how the lender will view the gap year and the change to casual. Will I have to wait 3 months? Any way around it? TIA
     
  2. Shahin_Afarin

    Shahin_Afarin Residential and Commercial Broker Business Member

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    Most lenders don't treat casual income/employment well but at 50% you may be able to get exceptions however best to use a lender that has a decent casual policy from the get go.

    CBA and NAB are the best with CBA being my personal favourite. They will look at 3 months salary credits and annualise this figure, 3 months YTD (which wont happen till the start of October) and if its less than October then they will need a combo of a payslip and the previous financial year. However since you took a gap year and need finance before October then you will need to go with option 1.

    When did you start as a casual? What is the nature of the employment?
     
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  3. Redom

    Redom Mortgage Broker Business Plus Member

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    This may be a little tricky if you need to use the income for servicing. This is because lenders wont really look back at your 10 year history and use the income earned. This stability and the low LVR does help paint an overall picture, but they'll look at your current situation to include the income.

    If you really need lending, perhaps it may be worth considering negotiating a part time contract? There are lenders in the 1 day part time contract space that will accept the contract and lend against it as part of their policy.
     
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  4. Angelar

    Angelar Active Member

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    Thanks Shahin only started this week in mining support
     
  5. Rolf Latham

    Rolf Latham Inciteful (sic) Staff Member Business Plus Member

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    id say this has legs................

    CBA will want 3 mths

    Other possiby wont, and not much of an issue at that LVR

    ta

    rolf
     
  6. Shahin_Afarin

    Shahin_Afarin Residential and Commercial Broker Business Member

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    Employment history, LVR and P&I repayments are great however I think the casual income and just started will be the issue. It will come down to the overall strength of the application such as how much surplus the servicing is, is the casual income the sole income or secondary income.

    We did one with ANZ recently where it was less than 3 months but they were in the same industry. ANZ's policy is that they generally want 6 months.

    The thing that I would really focus on is the employment history and the fact that you have been with the same employer for such a long time. Your scenario is rather unique so I would a) engage and broker and b) get some form of acceptance from credit before submitting the application as you do not want to fry your credit file.
     
  7. Richard Taylor

    Richard Taylor Well-Known Member

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    Why not do it as a Private Coded Loan for 2 months and then refinance to a traditional lender after this.

    Not necessarily the cheapest option but a solution to a potential problem.

    Cheers


    Richard
     

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