Ryan Smuts: I’ve just changed jobs, what does my lender need to know?

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Though the effects of Covid-19 are being felt acutely across the board at the time of this article being published. We feel that it is important to, as much as possible, keep with our original content schedule to maintain normalcy and provide a balanced range of information to help our readers make better decisions long term. This article was produced before current events without accounting for or addressing the extraordinary circumstances we find ourselves in right now. It is not intended to distract or diminish the current challenges of Covid-19 for property investors and their tenants.

You’ve just changed jobs and you’re wondering what your bank would like to be made aware of. Well, that all depends on where you are at with your bank!

If you have an existing mortgage and are not looking to make any adjustments to it, then the reality is that lenders will not be too terribly fussed to
know about your job situation. In saying that, I am assuming, of course, that your financial position largely remains the same and that there are no
material changes. So keep up with those mortgage payments and you shouldn’t have any issues. If your new job is going to make a material difference
to your financial position then you are best to have a chat/discussion with your broker/lender.

Now, securing new lending (whether to buy a new property or top-up for renovation) is a completely different beast. Lenders will definitely want a firm
understanding of your employment situation. The two key scenarios to be mindful of:

If you’re about to apply for a loan and have just started a new job, the lender will be most concerned about probationary periods and some such. They
may want to wait until you are free and clear from probation before committing themselves by way of a loan offer. Again, much would depend on the
type and scope of the lending and your overall position.
If you’ve already been approved for a loan, it is definitely important to let the lender know of a change in employment. The key thing here is whether
the remuneration amount is the same as what you were on when you applied for the loan and also whether there is a probationary period. Assuming
the income is the same and there is no probationary period – you shouldn’t have any issues here. Still, you need to let the lender know.

Every situation is different, and there are many types of lenders out there with different criteria, so if you’re in a situation where you need to move
quickly and are stuck for funding while in a probationary period – feel free to reach out! You can contact me at [email protected] or on 021 193 9333.