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Mortgages for Locum Doctors
If you are self-employed or receive ad-hoc payslips as a locum doctor, approaching the right lender is key to your mortgage success. The majority of high street lenders prioritise mortgages for those with an income stream which is steady and consistent, so getting a mortgage can be a challenging when you face scattered working patterns.
Locums often have multiple income sources such as from GP Partnerships, a hospital trust, or a medical staff agency to name but a few, yet as a locum doctor or sessional GP, fitting lender criteria for a mortgage can prove quite difficult.
However there are a few specialist lenders who unlike most high street banks, understand the unique working patterns and irregular income of locum doctors and are still very much happy to lend.
Sole Trader Locum Doctor
If you’re operating a Sole trader, lenders may assess your affordability by either looking at your SA302 tax calculations and Tax Year Overviews, or looking at the net profits as seen on your accounts.
Due to the fact that your income may fluctuate due to not having a fixed salary, some lenders may require you to have two or three years worth of accounts, although a handful of lenders may lend with just one.
Locum Doctor within a Limited Company
If you work as a locum through your own limited company, most lenders will calculate your income by looking at your salary plus dividends. Most lenders will request you SA302s and Tax Year overviews or copies of your certified accounts as proof of income.
PAYE Locum Doctor
If you get paid directly by your NHS trust, lenders will look at the figures on you P60s and payslips to assess your affordability. The majority of lenders will require you to have a track record of at least 12 months-worth of locum work and it is recommended that you keep a record of all your payslips going back six months where possible.
Locum Doctor paid through an Umbrella Company
The way your income is assessed when you’re paid through an Umbrella Company can vary hugely from lender to lender. Some will request three months worth of payslips alongside your P60 as income evidence but this may not reflect the true value of the contract that you have in place. Some lenders will instead look at the contract you have and use around 80% of the annualised income stated on the contract to assess your affordability.
Here at The Mortgage Masters, we work with lenders who take a flexible approach to lending where locum doctors are concerned and may even lend in situations where you have less than one year of accounts. The decision to lend to you will depend on factors such as your credit history and work history.
How much can I borrow as a Locum Doctor?
As a very general rule of thumb, most applicants for a residential mortgage can borrow up to 4.5x their proved earnt income. However, there are lenders that look favourably on professionals such as doctors. We know lenders who will take not only your basic salary but all your additional income such as overtime, bank hours, shift allowances and locum fees into account. This means that your borrowing potential could actually be 5.5x to 6x your salary!