Fly-In Fly-Out (FIFO) workers are some of the highest paid professionals in Australia but they can struggle to qualify for a mortgage.
The problem is that most banks don’t understand how FIFO workers get paid and will often overlook the allowances they’re entitled to.
By providing the right evidence, you can increase your borrowing power and qualify for a FIFO worker home loan.
How much can I borrow?
- Borrow up to 95% of the property value to buy a home or up to 105% of the purchase price with a guarantor.
- Borrow up to 95% to buy an investment property.
- You need to have been in your job for at least 6 to 12 months but this isn’t a requirement with all lenders.
- You may be required to provide a current employment contract if you’re employed through an agency or subcontractor.
- Discounted interest rates are available.
- Mining engineer discounts: Waived Lenders Mortgage Insurance (LMI) and negotiated rates available to eligible mining professionals.
Please call us on 1300 889 743 or complete our free assessment form to find out if you qualify for a FIFO worker home loan.
What do most banks think?
Banks don’t generally take a common sense approach when analysing the way FIFO workers earn a living.
They don’t know how to read your payslips
When applying for a home loan, most lenders will ask you for two payslips to prove that you’re earning an income and that it’s consistent.
The problem with FIFO workers is that they typically work for 3 weeks with 1 week off.
If you provide one paycheck for the start of the pay cycle and one for the middle of your pay cycle, the payslips will show irregular income.
Banks won’t be able to rely on this income when working out your ability to afford the mortgage so your application may be declined.
Most of them don’t understand allowances
FIFO workers are often entitled to extensive allowances or fringe benefits as a result of working away from home.
These fringe benefits include:
- A company car.
- Car allowance.
- Entertainment.
- Housing.
- Board or a Living Away From Home Allowance (LAFHA).
- Loans with no or reduced interest rates.
- Health and group life insurance.
- Child care and assistance reimbursement.
- Employee discounts.
- Employee stock options.
- Other expense reimbursement.
Most lenders don’t understand that FIFO workers salary sacrifice in order to receive these benefits.
As a result, your borrowing power can be severely reduced and prevent you from borrowing the amount you need.
Most of them don’t like contractors
FIFO workers are typically PAYG contractors employed on a fixed term.
Banks are concerned that when the contract ends, they won’t be able to find other work and default on their mortgage repayments.
How can we help?
We’re FIFO worker home loan specialists that are experts in the lending policies of nearly 40 Australian lenders.
There are some solutions to these common roadblocks that you’ll find when you apply with a bank directly.
- If your payslips don’t reflect your actual income, providing your latest group certificate may be enough to prove your after-tax income.
- If you’ve been working for less than a year or your tax return doesn’t reflect the salary for a full financial year, you may need to provide a copy of your work contract.
- To improve your borrowing power, a couple of our lenders will add back your allowances to better show your actual income.
It’s common for FIFO workers to be on a fixed term contract or move between mines depending on the availability of work.
One of our lenders takes a common sense approach and acknowledges that most FIFO workers can find alternative employment in the event that their contract is not renewed.
Speak to a mortgage broker by calling us on 1300 889 743 or by completing our free assessment form.
What documents do I need to provide?
Generally speaking, it’s good to have the following prepared for your application:
- A copy of your ID (your Driver’s Licence).
- Your last two payslips.
- Your most recent group certificate.
- A copy of your group certificate.
What if I work overseas?
It’s not uncommon for FIFO workers to work overseas.
If you’re working for an Australian-based company and earning Australian dollars, this shouldn’t affect your ability to borrow.
However, if you’re earning foreign income, check out the foreign income home loan page for more information.
Most banks will only accept certain foreign currencies and will only use a portion of your income for serviceability (how they work out your ability to borrow).
Some of our lenders don’t have currency restrictions at all and can accept 100% of your foreign income.
The trade-off is that your borrowing (LVR) may be restricted.
Foreign income lending policy can be quite complicated so it’s best to complete our online enquiry form and tell us about your work situation.
Discover if you qualify for a FIFO worker home loan
Looking to rapidly build your investment portfolio?
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One thing investors often overlook is mortgage exposure limits and how they can stop your plans for growing your portfolio.
Speak with one of our expert mortgage brokers on 1300 889 743 or by completing our free assessment form today.