You Can Take Advantage of a Contractor Home Loan

May 16, 2012 by  Filed under: Loans 

Most freelancers are scared about one thing: their future.

While these people are passionate about what they do, which is why they are successful at it, the very nature of their job keeps them from having a very solid backup plan.

Since freelancing means you get to choose the projects you want and it keeps you free from being bound to a particular company, you will not enjoy the benefits being given to employees of companies.

You won’t get to receive medical insurance, paid vacation and sick leaves, and others. Aside from that, it can be difficult for you to get approved for loans, like a mortgage, because you cannot provide proof of a long employment history with a certain company.

This is why most freelancers are worried about their chances of securing a home for their future. They are not sure if they are going to get approved for mortgage loans because of their jobs.

But with the availability of contractor home loans it is not something that you should heavily worry about anymore.

What is a contractor home loan?

This is a type of home loan that is awarded to people who are not employed permanently, or contractors. Examples of these people are freelancers, self-employed individuals, and sub-contractors.

These unconventional employees typically find it hard to get approved for standard mortgages. The reason behind this is lenders are particular about the employment of borrowers. They want to see proof that someone has the ability to pay off the loan in the years to come. That means they want someone who has a stable and permanent job.

Contractors can’t be certain of how long they are going to be working with a certain client as most of the jobs these people get are on a project basis.

In short, a contractor home loan is something that will give contractual workers the chance to have their own house.

How do you take advantage of these loans?

Contractor home loans are fairly easy to qualify for as long as you have a good mortgage broker. Brokers can play a huge role in your quest to become a homeowner because they can connect you with the right lenders.

There are enough bank and non-bank lenders who are willing to grant mortgage loans to contractors. You go to them and ask for assistance. Of course, you need to make sure that you meet the requirements.

You need to show that you are working on a project for at least 6 months. For those who are employed as a sole trader with an ABN, 2 years is the minimum time frame. Although there are some people who can get approved for a home loan even if they have spent only 1 day on the job. This, obviously, will have specific requirements.

As mentioned, you have to make sure you talk to the right mortgage brokers. Incidentally, most of these people are contractors too. That should be good news because they are going to be able to sympathize with you. They know the issues you are dealing with, so they are more likely to do everything possible to help you take out a loan.

You do not need to worry about being a freelancer anymore. Don’t be one of those people who decide to switch careers with a heavy heart just so they could make their dreams of owning a house come true. By qualifying for a contractor home loan this should not be something you need to entertain in your mind.

Contract employment has become increasingly popular in Australia, with one third of our workforce consisting of contractors. They are often receiving better remuneration and companies see outsourcing contractors as a productive business measure. Contractor home loan helps contractors build a better future.

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