Applying for a mortgage but changing jobs at the same time? Risky business.
If you're changing jobs and you haven’t got a mortgage yet our advice is to chat to an independent mortgage advisor. They can run through all of your options and get you the best deal.
Alternatively, read our getting a mortgage with a new job guide.
Why do mortgage lenders care if you change jobs?
1. You might get made redundant
Don’t panic! We’re not saying getting a new job isn’t ever a good idea and that you’ll be putting your security at risk. There’s just an ever so slightly higher risk of redundancy as a newer employee. You know the phrase ‘last one in, first one out.’ That’s what lenders are thinking.
2. You’ll probably be on a new probationary period
Starting a new job means you’ll probably have a probationary period when you start. That’s a short period of time where your employer can end your contract at short notice. And if that happens, it could be difficult to pay your mortgage. It might be scary for you, but it’s also scary for your mortgage lender!
3. Your income will probably change
You may have just proved your income to get the mortgage approval, but changing jobs after means that it’s no longer true for the future. This makes the mortgage lender’s calculations invalid, and you left unable to prove your income just yet with no pay-slips. Essentially back to square one!
What does that mean for me?
It means changing jobs after mortgage approval is not the best position to be in. The lender has assessed your previous situation and approved you for a mortgage, but now your situation is fairly different! That’s not to say that your mortgage is now declined, but that the lender needs to reassess their view on lending to you.
The first thing you need to do is let your mortgage broker know. They can advise on the situation and how to handle the lender. In fact, they’ll talk to the lender for you. You don’t really have to do much.
If your job is relatively similar, such as another full-time position with the same or better salary, you may be able to convince the lender to continue with the mortgage. But if you have moved to a part-time position or a fixed-term contract with a different salary, your lender is not going to like it. They are mostly concerned with your ability to repay the mortgage each month, and with a different salary, it’s going to be harder.