Registered nurses in Australia earn an average salary of $65,000 per year. That’s enough income for most lenders to approve your mortgage, provided you don’t have delinquencies and the amount you’re borrowing isn’t out of your league.
However, home loans for nurses consider much more than that. It becomes quite complicated when a nurse applies for a mortgage.
Can a nurse buy a house still? Of course, but as you know, the income of nurses can be greatly fluctuating.
This can be detrimental to your application, but don’t worry. Follow our tips below to increase your chances of getting a home loan.
1. Establish Your Employment History
While your current income is important in assessing your qualification, your work history is almost as important. Lenders use it to create a vague idea of your capability to pay in the future.
At the least, you should have 12 months of history. Although, your chances will have a significant boost if you have two years or more of experience.
Some lenders consider the nursing school as a part of your work history. But having experience isn’t all that matters when applying for home loans for nurses.
They’ll also look at your income for the past 12 to 24 months to assess its stability. To them, the more solid your employment history (and income) looks, the more likely it is that you’ll continue to work (and receive the same income) in the future.
While we’re talking about history, take a look at your credit history, too. You can get a free credit report once a year from any of the three credit reporting bodies.
2. Prepare Explanations for Employment Gaps
It’s somewhat common for nurses to change employers, pick up per diem work, or take a few months off. Employment gaps are especially common for travel nurses.
Lenders will question any gap they see in your history but don’t worry, they’re not deal-breakers. They’re not red flags, but they’re flags still. Exceptions would be some extended periods of unemployment.
You’ll only have to prepare proper explanations for such gaps.
Why are employment gaps such a big deal, anyway?
Like we said above, lenders use your past to see if you will continue to have a stable income in the future. Gaps indicate instability. If you were to have another gap while paying for a mortgage, you might not be able to pay on schedule.
Your income stability is what matters to them, so you might have to provide more than explanations at one point. For instance, you’ve only started picking up night shifts, which add to your income. The lenders would likely want to have the assurance you’ll continue picking up night shifts.
You might need to get a letter from your employer saying that this set-up will likely continue in the future.
3. Consider Your Current Debt
Your lenders will also look at your current debt and everything you’re still paying off. Before they do that, though, take a look for yourself.
Nurses rack up a lot of debt because of schooling and training. This is often why you might find it hard to get mortgages for nurses.
Calculate how much money you’re using each month to pay off debts. Then, get an estimate of how much you’ll be adding to that once you get a mortgage.
Do you think you can consistently pay for that amount for the following decades? Are you sure you can handle additional debt?
If you don’t think so, lenders will likely agree with you. That’s why you must assess.
If you’re struggling, it will show through your application. When you’re ready, you can show you’re ready by showing your savings and income sources, as explained below.
4. List Down All Your Income Sources
One of the mistakes you can do is listing down only your base pay. More often than, nurses get way more than their base pay each month. That’s because they still have night shift differentials and overtime pay.
The way that lenders consider these into your application, may vary. Some might only include them if you have a history of receiving these types of pay for two whole years. Some might not even use them when calculating for how large of a mortgage you qualify.
Still, it’s a good idea to include them all in your application. Lenders often include variable income in other occupations, so there’s a good chance you can use your extra pay to qualify.
Fringe benefits are common for nurses, too. You might be getting meal allowances and such, but relevant?
It depends on the lender, but if you can, find one that adds such benefits to your income.
Gather your pay stubs and any documentation about all your extra income. Get a letter from your employer stating your whole package, including night shift differentials and fringe benefits. Give the lender a name and contact number of your HR, as well.
They may not be a requirement, but they might help your case.
5. Ask for Help
You can talk with lenders directly, sure. But, if you want to increase your chances of getting approved, it’s best if you work with a third-party instead.
Mortgage brokers can help you prepare your application and everything you’ll need.
They have a more important role than that, though, and that’s to find the right lender for you. As a nurse, you want to find a lender that understands all your special circumstances to increase your total borrowing capacity.
Brokers would already know which lenders are the right fit for you, so you don’t have to find them. They’ll take care of the whole process, which is a whole lot off your shoulders. View more info to know more about how they can help you.
Know Your Home Loans for Nurses Options
Nurses may not be the ideal employee on paper, but getting a mortgage isn’t impossible. Lenders are now quite aware of what a nurse’s application looks like. Still, you have to do your part to prove you are (and you’ll be) a good payor.
Look around for the best home loans for nurses, and talk to brokers to improve your chances of getting approved. For more financial tips or career guides, check out our other guides right now! For more informative articles check this websites.