Mortgages for Agency Workers

Trying to buy a home when you’re working through an agency or on a temporary contract can feel like swimming against the tide. 

Many agency workers worry that lenders won’t take their income seriously, or worse, reject them outright.

And it’s not just a hunch: recent research shows 70% of gig economy workers in the UK believe their job status has negatively affected their chances of getting a mortgage. 

With over 1.6 million people (approximately 5% of the UK population) now in temporary jobs across the country, this is a concern shared by a growing segment of the population.

In this guide, we’ll break down the key challenges agency workers face when applying for a mortgage.

We’ll also look at how lenders assess your income, what type of contracts are considered acceptable, and what kind of documents you’ll need to prepare.

Can You Get a Mortgage As A Temporary or Agency Worker?

Being on a temporary or agency contract does not disqualify you from getting a mortgage. 

This is a common misconception; many assume banks only lend to full-time permanent staff, but that’s not true.

As long as you meet the lender’s criteria for income, credit, and deposit, you can be approved.

However, the pool of lenders is smaller as not every bank is comfortable with non-traditional employment.

The key to getting mortgages for agency workers is that you’ll need to prove stability in other ways since your job title isn’t “permanent.”

Lenders will closely scrutinize your finances and employment history, but if those check out, you have a solid chance of securing a home loan.

We recommend consulting a specialist mortgage advisor who has in-depth knowledge of this niche.

They know which lenders are flexible with temp contracts and can introduce you to the right options.

How To Get Approved for Agency Worker Mortgages: Key Factors

When assessing a mortgage application from an agency or temp worker, lenders look at largely the same things as any applicant: income, stability, credit, and deposit, but with extra caution.

Here are the main factors and how they apply to you:

Income Stability and Affordability

Your income may fluctuate month to month, so lenders will want to see that you earn enough on average to afford a mortgage. 

Typically, a bank will calculate how much you can borrow based on your income, often using about 4.5 times your annual income as a rough limit.

Check our mortgage affordability calculator to find out how much you can borrow.

If your earnings vary, many lenders take an average of the past 12 months (or more) to determine your typical income.

Moreover, just like any applicant, you can also include other income sources on your application (such as regular bonuses and a partner’s income) to strengthen your case if these are deemed acceptable by the lender.

The more stable and documented your earnings, the better.

Length and Type of Contract

Lenders will check what kind of contract you have and how long you’ve been working in this way. 

Contract length is important: some mortgage providers want to see that you’ve been contracting or temping for at least 12 months under your current arrangement.

This could mean you have been with the same agency or on successive contracts for a year or more.

Contract type matters too. 

Some lenders are happy with all sorts of contracts (fixed-term, rolling contracts, etc.), but others have restrictions. 

For example, a bank might prefer that you’re on a fixed-term contract that has a clear end date and possibly an option to renew.

Also read: Zero Hours Contract Mortgages

Each bank has its own policy, so this is an area where a mortgage advisor can match you to a lender that fits your particular contract scenario.

Continuous Employment and Gaps

One big concern for lenders is whether you have gaps in your employment. Since agency and temporary work can involve moving between contracts, it’s common to have short breaks. 

Most lenders understand this, but will have limits on how long a gap is acceptable. Generally, you’ll need to show that you’ve been working more or less continuously. 

Short gaps (a few weeks off between contracts) are usually acceptable, but longer breaks raise concerns. 

Many banks prefer that any employment gaps be no longer than about 6 weeks at a time.

If you took a few months off with no income, a lender might worry that future downtime could affect your ability to pay the mortgage.

Credit History and Score

Your credit score matters a lot when applying for any mortgage.

For agency workers, this can be a make-or-break factor, because your job isn’t permanent, a lender will be even more interested in seeing that you handle credit responsibly. 

A strong credit history can somewhat offset some concerns about your employment status.

On the flip side, if you have bad credit (like past defaults or missed payments), it can compound the lender’s worries about lending to someone with irregular income.

In a recent survey of gig workers, 38% of those who were denied a mortgage said a low credit score contributed to the rejection.

So, it’s crucial to check your credit record beforehand.

Deposit and Loan-to-Value (LTV)

When you’re a temp or agency worker, be prepared to possibly put down a larger deposit than someone in a permanent job. 

Many mainstream lenders will restrict the loan-to-value ratio (LTV) for non-permanent workers. Often, they’ll lend a maximum of 80% of the property value, meaning you need a 20% deposit.

This lower LTV requirement is a way for lenders to reduce risk: the more of your own money you invest in the property, the less likely you are to default on the loan and the more equity that is available in a repossession of the property. 

So, for example, if you’re eyeing a £200,000 home, an 80% LTV cap means you might need to have £40,000 (20%) as a deposit when you apply.

Also, note that if you’re struggling with a deposit, you might consider buying with a partner or using schemes like shared ownership.

Frequently Asked Questions

Can I get a mortgage on a zero-hours contract?

Yes, it’s possible to get a mortgage if you’re on a zero-hours contract, but it can be more challenging. 

Lenders will want to see at least 12 months (or more) of steady income, despite the “zero-hour” status, basically proof that you consistently get enough hours and pay.

How long do I need to be in a job before I can get a mortgage as an agency worker?

Ideally, mortgage lenders like to see that you’ve been working in a temporary/agency capacity for at least 12 months continuously. 

This doesn’t necessarily mean 12 months in the same contract, but you should have a track record of earnings for the past year (with minimal gaps between jobs).

Do agency or temporary workers pay higher mortgage rates?

Not automatically. There isn’t a specific “agency worker interest rate” that’s higher for everyone.

If you qualify with a mainstream lender, you’ll get the same rates as any other borrower based on your deposit and credit score.

Will applying with a partner who has a permanent job help my chances?

Yes, having a partner (or co-applicant) with a stable full-time job can definitely help. When you apply jointly, the lender looks at the combined income and the overall stability of both applicants.

Are there special schemes for first-time buyers on temporary contracts?

You generally have access to the same first-time buyer schemes as anyone else. 

Being an agency or temp worker doesn’t disqualify you from programs like shared ownership or the new First Homes scheme (in England); you just need to meet those schemes’ criteria.