Have you been made redundant?
Losing your job can be tough but getting a home loan doesn’t have to be. Discover how you can your redundancy payment as a deposit.
How much can I borrow?
- Borrow up to 105% of the property value: You need a guarantor to be able to do this.
- Borrow up to 95% of the property value: Some lenders will use 100% of your redundancy payment on a case by case basis.
- You need to be currently employed.
- You’ll need to have a clear credit history and repayment history.
Have you received severance pay but need a home loan or want to refinance your mortgage?
Call us on 1300 889 743 or fill in our online enquiry form and we can let you know which lenders will accept severance as genuine savings.
How do I qualify?
- The severance payment needs have been in your savings account for at least 3 months.
- You will usually need to provide a Notice of Dismissal or Letter of Termination of Employment that indicates you were officially made redundant.
- Some lenders don’t require you to have genuine savings will use your redundancy payment as a deposit.
How much of your redundancy pay will banks use?
It depends on the lender but some will use 100% of your redundancy pay.
What if I was made redundant less than 3 months ago?
You need to be earning a regular income in order to qualify for a home loan. If so, we can help you find a home loan solution!
It will help your application if you have a savings buffer to help with making mortgage repayments, particularly if you currently have a mortgage and have had to take a pay cut.
What if I'm currently on probation?
With less than 3 months in your new role, you’ll have a greater chance at approval if you’re still in the same field or industry.
For example, if you were made redundant from your position as an electrician with a small business but you were able to secure work with a large subcontractor.
Of course, it’s common for people to switch industries after redundancy, especially in a turbulent sector like mining.
Generally speaking, if you’re now employed in a different field, you’ll need to complete probation before applying for a mortgage.
Check out the probation home loan page for more tips on how to get approved or fill in our free assessment form to find out how we can help.
We work closely with lenders that can consider your mortgage application even if you have been in your job for just one day!
How much do I need to buy a property?
Usually, you require at least 5-10% of the property value as genuine savings.
Anything above 80% LVR (Loan to Value Ratio) and you have to pay LMI (Lenders Mortgage Insurance).
Lenders consider borrowing more than 80% as a risky loan so mortgage insurance protects them in the event that you default.
You can ask your parents to act as a guarantor if you want to avoid LMI altogether.
Keep in mind that you need to be earning a regular income and meet standard borrowing power criteria to qualify for a no deposit home loan.
Discover if you qualify
Call us on 1300 889 743 or complete our free online assessment form to speak with an experienced mortgage broker about your situation.