Applying for a Mortgage With a New Job

Just started a new role, and unsure whether you can use the salary to prove your income on your mortgage application? Read the Revolution guide for insights into why lenders will care how long you've been in your position - and why it matters.

About your mortgage

Error: Yearly income income must be between £1 and £10,000,000.

Error: Regular bonus must be between £1 and £10,000,000.

Based on your yearly income, you may be able to borrow:

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Most lenders will let you borrow 4.5 times your annual salary so, as long as you have a standard 10% deposit, you should be able to borrow this much.

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Depending on your personal circumstances, some lenders may let you borrow 5 times your salary.

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Lenders usually cap the amount they lend at 5.5 times your salary, so it’s unlikely you’ll be able to borrow more than this.

This calculator is an estimation of how much you could borrow. If you’re ready to take out a mortgage, speak to a Revolution brokers to see what options are available.

Applying for a Mortgage With a New Job

It isn't uncommon to be rejected for a mortgage if you have recently started a position, with lenders being cautious about accepting borrowers without a longer-term work history.

However, it is usually possible to secure the home loan you need with support from an experienced, whole-of-market broker.

We'll run through the most important information here, but if you would like help finding a competitive mortgage with a new job, give us a call on 0330 304 3040, or email the mortgage Brokers team at info@revolutionbrokers.co.uk.

Why Getting a Mortgage With a New Job is Harder

Most high street lenders will only accept a mortgage application from borrowers who have been in their role for at least a year - with some demanding a minimum of three years.

This stance isn't exhaustive, and there are plenty of niche lenders out there with far more flexible policies!

Getting a new job can make it harder to find a mortgage since the lack of a stable income from your current employer makes the application a higher risk.

Generally, a role is more vulnerable to dismissal or redundancy during the initial employment period.

Advice for Applying for a Mortgage With a New Job

The crux is that a lender will consider your income more reliable if you have been in continuous employment for some time.

They'll be confident that you aren't at risk of losing your job or failing to pass a probation period and be unable to keep up with your mortgage repayments.

However, there are lots of variables between lender policies, for example:

  • Some will be happy to consider applicants in a new job, provided they have been in ongoing employment beforehand, sometimes with the rule that it must have been in the same sector or type of role.
  • Others will want to see between one and three years of back-to-back jobs and decide that's sufficient to prove affordability.
  • Alternative lenders may be more flexible and deem any ongoing roles acceptable over three to six months, even between different jobs.

We mentioned earlier that some select mortgage providers will lend to new applicants without a minimum employment history, but note that isn't the norm.

You'll usually pay higher interest and fees.

The key is to work with a skilled broker to highlight those potential stumbling blocks in your application and guide you through ways to strengthen your prospects.

For example, if you can attach a contract of employment for a certain number of years or prove that you have other income sources, your job history may not be a deciding factor.

Can You Get a Mortgage With New Job Contracts That Have Just Started?

If you are offered a new contract with a new role but staying with the same employer, a lot depends on the lender.

Some will accept the application but base their affordability assessment on your previous salary until you have at least three months of payslips at your new pay structure.

Other lenders are rigid, and if you are in a new position, they won't offer a mortgage for at least a year, even if the employer is the same.

New Job Mortgages After Changing Contracts

A lot depends on whether you're staying with the same employer, or contracted to the same company, or whether the new contract is with a completely different organisation.

Lenders may also wish to examine the terms of your new contract:

  • If there isn't a probation period attached, a lender might view a new contract as a positive indication that your income will soon rise.
  • They may not calculate your maximum mortgage borrowing based on the new salary if you don't have one to three months of payslips at your new contracted rate, but others will if you aren't on a probation period.
  • New roles that carry probation, with the caveat that you will revert to your old, permanent position if things don't work out, are normally acceptable since there is a minimal risk you'll lose your job altogether.

If you're self-employed, the situation changes somewhat, and specialist lenders are often a better bet. If you've got a solid trading history and want to borrow based on a new contract, they'll still look over the last two or three years to make a risk assessment.

How Does a New Job Affect Getting a Mortgage?

Mortgage lenders can be cagey about lending to applicants in a new job because they are obliged to lend responsibly, according to UK regulations.

If they can't verify how much you earn a year or how much you're likely to earn in the years ahead, it can be tricky to make an offer.

This caution is why some mortgage lenders will outright refuse any applicant who hasn't been in their existing position for a minimum period.

Others won't be concerned about the duration of your current contract provided you have been in continuous employment for a number of years.

We often work with clients in a range of situations, such as:

  • Having just taken up a role with a brand new employer.
  • Applicants who have changed contracts within the same business.
  • Mortgage borrowers with a newly received pay rise.
  • Those who are about to start a job within the next few months.
  • People who have a contract but are on probation.
  • Workers with short-term or temporary contracts.
  • Professionals and self-employed tradespeople who are newly qualified.

The best way to proceed if you don't have ample proof of your income or have recently started a new role is to work with a professional broker.

We can recommend lenders with a certain degree of flexibility, enhance the stability of your application, and negotiate rates and terms on your behalf.

New Job Mortgages After Receiving a Pay Rise

In most cases, if you've had a pay rise, it will improve your mortgage prospects because your future earnings will be higher and - theoretically - you can borrow more.

However, that can be less straightforward if you base your mortgage value on your new salary but don't have any evidence such as bank statements or payslips.

Lenders will usually limit the amount they lend according to the earnings they can see on your documentation, often in respect of the regulatory rules we mentioned before.

Some mortgage providers don't always deal directly with the public and will treat a pay rise as a given as long as you've got written documentation.

That could be a letter of offer or a copy of the new contract evidencing the amount you will earn from now on.

Is it Better to Wait Until Getting a Mortgage With a New Job UK?

In some cases, it can be wise to wait six months or so before you apply for a mortgage, particularly if you're set on applying to a high street bank or a mainstream mortgage lender you've worked with before.

If you can't wait that long, need to move home quickly, or simply aren’t keen on delaying your move, we'd strongly recommend getting in touch.

Although it can be more difficult to find a new job mortgage, some lenders will approve your loan, usually if you have two or three years of steady employment history and can provide details of your exact income.

Lender Attitudes to New Job Mortgage Applications

It all depends on choosing the right lender.

Some mortgage providers will be happy to base your mortgage offer on your new salary, provided you have a contract letter and at least one bank statement.

Less flexible lenders will only make an offer based on your old salary until you have several months of income records at the new pay rate.

Getting a Mortgage With a New Job While on Probation

As with these other scenarios, some lenders will decline any applicant in a probation period since there isn't a guarantee that the position will become permanent.

Others will be happy with applicants on probation but will ask for information about your industry experience or qualifications to be assured that you'd be likely to find a similar role should the probation period not work out.

New Job Mortgages When on Probation

Probationary periods are a problem because a lender can't know whether you will be offered a permanent or long-term role when it ends.

Most employers have the right to dismiss a probationary employee without notice if the position doesn't work out, so even lenders that do offer new job mortgages will want to look at:

  • Whether you've got a long track record in your sector or position.
  • If you've been in continuous employment without a break before.
  • How the probationary period factors into your contract.
  • The length of the probation, and if the contract is permanent after that.

Any application with an added risk factor will be subject to extra scrutiny at the underwriting stage, so they'll also consider your deposit value, credit history and other circumstances to make a balanced decision.

Expert Advice on Getting a Mortgage With a New Job UK

The key to finding a competitive mortgage while in new employment is to work with a whole-of-market broker who can recommend lenders who are in the best position to approve your application.

It is possible to find a competitive mortgage if you're in a new job, within a probation period, have just received a pay rise, or switched roles with the same employer.

The pitfall is that finding the right lender is crucial - most high street banks offer little to no flexibility.

They will reject your application outright or offer incredibly high fees to consider taking the loan on.

Contact the Revolution Brokers team on 0330 304 3040 or email us at info@revolutionbrokers.co.uk for personalised support to find the home loan you require at the best rates on the market.

Why Revolution Brokers?
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FAQs

How does our broker-matching service work?

Usually, yes, as long as you work with a whole-of-market broker who can signpost your application to the most suitable lenders, you can apply for a mortgage in a new job.

In some cases, you can even complete on a mortgage before your new job starts if you're taking up a position with a permanent contract!

It's a little harder to find new job mortgages if the role is a fixed-term contract or agency work, but there are options.

Most mainstream lenders will need to see six months of employment history, but others will be happy with one payslip, so your choice of provider is vital.

Offer letters can be useful in backing up all the information you've provided, such as your expected salary and when the new role starts.

Lenders will sometimes rely on an offer letter as proof, but some will ask for the official employment contract to be sure the paperwork is legitimate.

Again, it's all about selecting a lender with the right policies since some will approve mortgages with a job offer letter as long as the role starts in the next three to six months.

You can get a mortgage within a probation period. However, that will depend on the nature of the role, your previous job history, and any other high-risk factors present within your application.

Getting onto the property ladder is hard enough, made trickier if you are in a new job, even more so if it's the first job you have had!

Lenders will commonly ask for a larger deposit from a new applicant, especially if you don't have a lot of credit history.

However, you may also qualify for several government support schemes to provide lender guarantees and financial help with your deposit - get in touch if you'd like more information about the potential options.

Skilled professionals have a much easier time getting new job mortgages because:

  • Lenders know they are in high demand and won't have a problem getting a role elsewhere if they need to.
  • Average incomes are often higher than average and easy to verify if it's a public sector role like a teacher.
  • There are exemptions for NQTs, and all sorts of mortgages for doctors, dentists, accountants and solicitors - professionals are deemed significantly lower risk than many other occupations.

If you need to move forward with your mortgage, we'd suggest you get in touch immediately to assess the options and start making a plan.

Even if you decide to delay your mortgage application for, say, three or six months, it'll give you plenty of time to work with your broker, research the market, and make sure that when you're ready to apply, you can tick all of the eligibility boxes.

As we've covered, lenders like to offset their risk by charging higher fees or interest or asking for a larger deposit to reduce their exposure on the property.

However, mortgages are available with deposits from 5% and above and multiple initiatives that may prove beneficial.

For example, if it's a new build, you could use Help to Buy to raise 20% of the property’s value in a loan that is interest-free for five years, or you could use a mortgage guarantee product where you pay a 5% deposit, and the government guarantees the balance.

Affordability metrics can be pretty variable. Most lenders will offer roughly 4.5 times your annual salary as an upper limit, but that's subject to conditions.

Higher-income earners with a salary of £60,000 and above may be allowed to borrow five times their yearly earnings, but the lender will need to make a judgement call.

The best option is to determine how much you'd like to borrow, communicate that with us, and then we'll look at your income, future earnings and recommend lenders that are most likely to offer you that value.

Interest rates shouldn't necessarily be higher because you've started a new job, and you can get a great deal without delaying your application for months.

It's wise to remember that low-interest rates don't necessarily mean the mortgage is low cost.

You also need to look at arrangement charges, valuation fees, cashback offers or other incentives, and exit penalties before comparing two mortgage products on a like-for-like basis.

The location shouldn't be a big deal, although a lender may raise a query if you're applying for a mortgage on a property, but your new job appears to be outside of a viable commute.

If your role is home-based, the lender will typically check the contract terms to verify that it's permitted.

Ultimately, the only reason location is an issue is that the lender is concerned that you'll need to increase your expenses to rent accommodation closer to your role during the working week, which could affect your ability to keep up with your mortgage repayments.

The basic documents you'll need are payslips and bank statements, but you can apply for a mortgage with an offer letter or contract of employment if you have a new job.

If you've had a pay rise but stayed within the same role (or been promoted), you can use that increased income to apply for a higher mortgage value.

The rules are similar to those for applicants with a new job, so the lender will assess how long you have been in the new role, how stable it is, and the likelihood that your income will drop during the mortgage term.

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The content included in our articles, blogs, web pages and news publications is based on information accurate at the time of writing. Note that policies and criteria can change regularly throughout the UK mortgage lending market, and it remains essential to contact the consultation team to receive up to date guidance. The information included on the Revolution Brokers site is not bespoke to any circumstances or individual application scenarios and therefore is not intended to be used as financial advice. The content we share is designed to be informative and helpful but cannot be relied upon to provide individual advice relevant to your mortgage requirements. All Revolution team members are fully qualified, trained and experienced to provide mortgage advice of an independent nature. We collaborate with lenders and providers who are regulated, authorised and registered with the Financial Conduct Authority (FCA). Should you require specific mortgage borrowing types, some products such as buy to let mortgages may not be FCA regulated. The Revolution team can provide further information about regulated and unregulated lending as required. Please remember that a mortgage is a debt which is secured against your home or property. Your home can be at risk of repossession if you do not keep up with the repayments or encounter any other difficulties in managing your mortgage borrowing responsibly. This also applies to any remortgage or home loan secured against your property, including equity release products.

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