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There are a range of specialist and regular lenders in the Australian market who can provide loans to those who work on a casual basis. While many lenders consider casual employees too big a risk due to their fluctuating income, this is not always the case, and there are ways for a casual employee to obtain a home loan just like any other gainfully employed Australian, usually through a low doc home loan.
A low doc home loan is a mortgage that is designed for the self employed or someone who receives an irregular income and can’t prove it through normal means. However, these types of loans are considered to be of a higher risk than the regular home loan, and so higher rates and in some cases lower maximum LVRs (the amount you can borrow in relation to the property's purchase price or value) can apply.
Mortgage brokers are home loans experts who can help those with casual employment to find a home loan which suits them. They have access to a range of lenders, so can compare home loans on your behalf to find the best option for you. Mortgage brokers generally earn a commission from your lender, which means the service is free to you. You can compare mortgage brokers below. If you'd like to read more about a broker, click 'Details', and if you'd like to lodge an enquiry click 'Enquire'. Your broker will contact you back within one business day.
If you're a casual worker applying for a home loan you'll most likely need to show that you've been working steadily by providing the last two years group certificates. From there, the lender will likely take the lesser of the two and deem that to be your income. If you have not been with the same job for several years you may have a more difficult time providing proof of income.
In this case, some lenders may use your year to date (YTD) income and calculate what your yearly income would be. This method will only be used by lenders who are willing to extend a mortgage to a casual worker who has not been under the same employment for a significant amount of time.
John has worked as a casual worker in the same industry for 3 years and thought he was ready to apply for a home loan. He had $10,000 in savings and was able to cover the cost of his rent and monthly expenses with his income. The lender he chose looked at his gross income and felt confident that he could afford monthly repayments of $810 a month.
This allowed John to borrow $150,000 at an interest rate of 4.94% for 30 years. Since this was a variable rate loan that also included fees, he chose to buy a smaller home and borrow only $135,000. This allowed him to make his repayments promptly without having to worry when his income fluctuated down.
Even though your income criteria may be different than that of other borrowers, you generally still have the same opportunity to apply for many of the same loan products as someone with a more steady form of employment. Consider these options when choosing your loan:
About low documentation home loans
Depending on the length of time you have been with the same employer will determine this. Some lenders will take the lesser of two years worth of group certificates while others may make calculations based on your YTD salary.
This will be entirely dependent on your income and the value of the property you are trying to buy. You can use our borrowing power calculator to help you figure this out.
Because each lender is different, regular and non-conforming lenders offer these home loans. All lenders will evaluate applications from casual workers on a case-by-case basis, so a mortgage broker can be a good option, as they will know from past experience which lenders are more suited to casual workers.
There are a range of lenders and products available for casual workers, and while nothing is certain, a prospective lender will look at your income, employment history and credit file when deciding whether or not you'd be eligible for a home loan. In addition, a mortgage broker will also have knowledge about which lenders to approach to maximise your chances of approval.
After entering your details a mortgage broker from Aussie will call you. They will discuss your situation and help you find a suitable loan.
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Hi, I have a causal job and wounding to brow around 70,000 to 80,000 is there any that could help me,Regards Ellie
Hi Ellie,
Thanks for getting in touch.
Typically it can be difficult to qualify for a home loan as a casual worker as most lenders view you as a high-risk borrower as you don’t have a stable source of income. However, each lender will treat these types of applications on a case-by-case basis so it will depend on the lender’s eligibility criteria and the type of home loan that you’re applying for.
Keep in mind that the lender will review your income sources, assets, liabilities and debts (e.g. personal loans or credit cards) to determine your propensity to repay the loan.
We have a guide that explains how banks treat bonus or irregular income which you might find useful. Generally, if you can prove to the lender that your income is paid regularly and if you provide them with a letter from your employer outlining the nature of your employment, then the lender may view your application more favourably.
Above on this page you can enquire with a mortgage broker who will help you understand your borrowing options. However, you may want to consider approaching specialist or non-bank lenders as they may have more lenient eligibility criteria.
All the best,
Belinda