An employment contract and a mortgage is a completely non-obvious matter, as it may seem on the surface.
A mortgage and employment is an extremely important issue, one thing happens that with sufficient creditworthiness and the form of employment most preferred by banks, i.e. an employment contract, you may not receive a loan.
What can you learn from the article?
Which industries are considered higher risk for banks?
How is the employer verified?
Are bonuses included in income?
A letter of intent is great news. It means that someone wants to hire you. Unfortunately, it does not affect your creditworthiness in any way. This is neutral information for a banking analyst. So for you it means you have to wait for the next step.
This is another good news, you have just started a new job, maybe one that you have been waiting for a long time? The bank still does not want to talk to you. Why is this happening? The employment contract for a trial period, as the name suggests, does not guarantee anything. This is the time when the employer checks you and you check the employer. Nothing more. So what should be done? You still have to wait. A contract in employment for a trial period is unfortunately not accepted by the bank, but by signing another contract for a definite or indefinite period, you can count the length of service also counts from the date of employment for a trial period contract.
This type of contract is treated the same as an employment contract for an indefinite period when it comes to calculating creditworthiness. This means that you should pay attention not only to the length of service, but also to how long our contract will last in the future. In the case of a fixed-term contract, the length of service with the employer in question must be three or six months and the contract must continue for another six months. What about the promise from the employer if the employment period is already shorter than six months? Unfortunately, promises do not mean much to the bank today. They used to be accepted as a derogation, but not anymore.
An employment contract for an indefinite period, which is the most desired by banks. When can we apply for a mortgage with this form of employment? After three months of work experience with the current employer, we can submit an application. Unless you have just changed your job, maintaining the continuity of work to one day. In such a situation, we can apply for a mortgage loan, having a contract for an indefinite period and a certificate of employment from the previous place of employment. As you can see in this example, an employment contract and a mortgage is a multi-threaded loan topic.
You already know the different types of contracts. It is also worth knowing the risks associated with the industry in which you may be employed. High-risk industries include, for example, casinos, companies that manufacture or distribute weapons. If you have shares in such companies, it is most likely that you will not get a loan. But if you are employed as an employee, you have a good chance of getting a loan. I am immediately reminded of another case in my experience, i.e. a client who worked in a casino on a fixed-term contract. We attached to the application a statement that he is not the owner of the casino, does not own any shares in the company and is only an employee.
I would also like you to know that the bank carefully checks your employer. If you work in a family business, it is best that your work experience should be at least 12 months. In most cases, the analyst will ask you to provide a certificate from ZUS on the basis for calculating contributions for the last six or twelve months. Thanks to this, he will be able to verify that you have not been employed in the family business only to take out a mortgage. This is irrespective of the credit policy, which says that the length of service should be at least three months.
If, on the other hand, you work in a small company that is a sole proprietorship or has a short period of time, then the chances of getting a loan are slim.
Do you work in a foundation or association? I remember a client who worked for the foundation for several years and had high earnings, a contract for an indefinite period and seemed to be an ideal client for the bank. After submitting the application to all banks, we received negative decisions. Reason? Too high risk for the bank. Of course, this reason can mean literally anything and explains nothing. It turned out that the employer was blacklisted in banks. What did the blacklist mean in that case? The employer may be suspected of extorting a loan, laundering money or simply failing to pay off credit obligations with banks.
The bank requires a PESEL number, a registered address and a permanent or temporary residence permit. In my experience, many foreigners get a mortgage from us without major problems. If the above issues are settled and there is sufficient creditworthiness, everything is simple afterwards. The terms of the loan are, of course, the same as for Poles. An employment contract and a mortgage loan for a person from abroad is the same loan, contrary to what is commonly believed. Maybe more difficult to admit because you have to be careful about additional bank requirements.
If it is a short sick leave of less than 30 days, the bank may not even ask you why. If it is a longer period, such an inquiry will definitely come from the analyst. Depending on the situation, the mortgage may even be withheld.
Very often, the salary is paid as a base with bonuses. If the bonuses are 100% monthly, we include them in the income, the same is with the quarterly bonus. In the case of semi-annual bonuses, it all depends on whether it was paid in the last three months. This applies to situations where a given bank relies on an average calculated over three months.
In the case of annual bonuses, it happens that analysts ask for regulations to confirm whether the bonuses are discretionary. If the title includes discretionary bonuses, regardless of the frequency of the bonus, the analyst may not take it into account, because such a benefit does not have to be permanent.
It happens that clients receive a daily allowance in addition to the base salary. I mean, for example, professional drivers. Unfortunately, diets are only accepted in one bank. Here I am going to quote another case from my professional experience. About a year ago, we had a client who received 100% of her salary as per diems. No bank was willing to accept this. The client was a foreigner, but had worked for a consulate for many years and even this form of income was accepted.
This is a very long credit thread, it is so serious that I devoted an additional article to it: mortgage and pregnancy. Since I am a mother myself, I want to reassure all other present and future mothers. The bank does not discriminate against pregnant women, and it is not worth hiding this thread from it. The only obstacle is the will to stay on parental leave after the maternity leave is over. Why? Because you declare in advance that you will not receive any remuneration, what will you pay off the loan from? This is the logic of the bank. I recommend the article mentioned by me, because I give a lot more details there.
This is not an obstacle, but you must present a certificate from the Social Insurance Institution on the basis for calculating contributions. In the case of payroll, the analyst may ask you for a certificate from the last six or twelve months. I am reminded of the stories of two of our clients. Ms. Gabriela worked in the factory for many years and the employer offered the possibility of choosing to pay her salary both in cash and on account. The client presented a certificate from ZUS and received a loan without any problems.
The second person worked for a small company, had an employment contract for an indefinite period and received a salary "in hand". The client went to ZUS for a certificate and it turned out that the basis for calculating the premium was PLN 1,000, instead of the declared remuneration amount under the contract of PLN 3,000. Of course, our client was convinced that the employer pays contributions on the full amount. You can check for yourself the amount of ZUS contributions paid through PUE ZUS.
If the break in employment was not longer than 14 days, there is a chance to get a loan after the first receipt of remuneration from the new employer, but on the condition that it is not a contract for a trial period. Then you need to prove the continuity of employment, i.e. present a certificate of employment with the previous employer and the current employment contract, preferably the employer is from the same industry. I have described this topic in detail in the article: mortgage and job change.
It happens that employers, out of concern for the company's cost policy, offer employees to switch to B2B contracts. In other words, they change employment to cooperation contracts based on economic activity. If this type of change occurs without interrupting the employment relationship, the bank can of course accept the change and you can apply for a mortgage. If you change employer but stay in the same industry, you can also apply for a mortgage. If you are interested in the topic of economic activity, see my other article: mortgage and business activity.
As you can see, contrary to appearances, an easy credit thread can have many threads and ultimately create many complications. That is why I always say that it is best to contact a specialist before taking a loan. Our credit expert helps you at the stage of finding a flat. Before you make a down payment and declare anything, you have proven creditworthiness and are able to compare many loan offers in one place.
Remember that if you have any doubts, I am happy to offer you advice and assistance. Let's meet, you will find that my help in choosing the best mortgage can be invaluable.
Feel free to comment. Is the topic of credit analysis interesting for you? Let me know in the comment. Will be happy to help clarify all issues. It is important to me that every topic regarding the mortgage is absolutely explained.
Mortgage broker
Michal Kaplon
os.Stefana Batorego 80
60-687 Poznan
Strona www stworzona w kreatorze WebWave.