Will a large deposit secure you a mortgage?

Published by on 07 October 2010.
Last updated on 08 October 2010

house on lump sum

Q: I recently got divorced and want to purchase a small property. I have £60,000 in cash but need another £20,000 through a loan or mortgage. I am an HGV driver and have done agency work for the past few months. My old bank (Halifax) refused to consider my case because I'm a temporary worker. Where else can I try?

A: Richard Morea is technical manager at mortgage brokers London and Country

Lenders' assessment of how much they are prepared to lend will hinge not only on your level of income but also the nature of that income.

Where employment is not on a permanent basis, lenders will have concerns over the stability of the income.

But if there's a good track record for income, the lender may be prepared to accept this kind of source. This may also be the case when working on a contract basis.

As a minimum, I'd say you need at least 12 months' worth of contract work to apply for a mortgage, after which you'd be able to look at the mainstream lenders like Halifax and Nationwide.

It's also worth noting that the small amount you want to borrow could fall beneath some lenders' minimum lending amount.

You might want to consider applying for an unsecured personal loan instead – but again you could struggle until you are able to prove you have a regular income.

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