Zero-Hour Contract Mortgages

Zero-hour contract work is a trend which has gained a distinct amount of traction in recent years. In fact, it seems as though more and more people are choosing to opt for alternative employment, as opposed to the ever-common salaried 9-5. Similar to casual contracts, zero-hour contracts represent an agreement where the employee is not guaranteed to receive any hours of work from a business, rather operating on an ‘on-call’ basis.

Despite zero-hour contracts being so widespread today, it remains that high street lenders tend to prefer - what appear to be - more consistently stable incomes when assessing mortgage applications. Followingly, if you’re on a zero-hour contract, then it’s likely that you’ve run into issues as a prospective homeowner, owing to the unconventionality that such jobs imply. However, it’s fairly evident that this perspective is becoming increasingly more antiquated. Fortunately, there are select lenders out there who take a more up-to-date approach when evaluating their candidates’ financial circumstances.

And, while you may see that some big banks and building societies list zero-hour contract mortgages among their offerings, you’ll quickly find that they are only willing to lend to those who fit into their singularly rigid criteria. Hence, mortgage types for those on zero-hour contracts are classed as being specialist cases, requiring a specialist lender, and thereby a specialist mortgage broker to be made accessible. If this serves to, initially, bring about a degree of hesitation on your part, there’s really no need to worry.

After all, there is a mortgage solution out there for every determined person, provided that they get the right advice. Fundamentally, If you want to make the correct housing decision by choosing from the best options on the market, it’s now virtually standardised that you should hire the services of an expert mortgage broker who is equipped with the knowledge to find a lender accustomed to your specific situation. We at The Mortgage Genie have helped many of our UK clients by securing a mortgage deal for them when they’ve been on a zero-hour contract, regardless of the usual obstacles. If you’re interested in joining the multitude among our success stories then be sure to reach us at 01915809890 today.

Having said what we can do for you, we still highly suggest that you familiarise yourself with everything there is to know about zero-hour contract mortgages. So that you can make an informed choice, we’ve put together this piece which goes over all the salient details involved. We’ll cover:

What is a zero-hour contract mortgage?

Simply put, a zero-hour contract mortgage is a loan provided to a borrower so that they can purchase a property while holding a zero-hour contract job, as opposed to being in regular full-time contractual employment.

Often, zero-hour contracts pose a preferable option for plenty of people, given that they have an inherent level of flexibility attached to them. In essence, a zero-hour contract is characterised by how an employer doesn’t set out a minimum number of working hours in the terms. Some businesses only offer zero-hour contracts because they function on a purely ad hoc basis. For instance, this is typical of industries which relate to hospitality, care work, delivery driving, and warehouse work. In the context of our ‘gig economy’, it’s easy to see why zero-hour contracts are so prevalent.

Why is it harder to get a mortgage on a zero-hour contract?

Notwithstanding the present climate of the employment market, the majority of lenders are particularly strict concerning who they allow to borrow from them. Consequently, this means that if you’re on a zero-hour contract and try to get a product from a high street lender, then it’s not unlikely for them to reject you outright. Naturally, this is cause for a lot of stress and frustration.

Principally, lenders are wary of giving out zero-hour contract mortgages because they view them as having an intrinsic ‘risk’ factor. Namely, zero-hour contracts do not guarantee an employee either work, or defined working hours, and this thereby denotes an uncertain income. This leaves mortgage providers with little incentive to lend, for that a stable income generally indicates a borrower’s ability to comfortably make their monthly mortgage repayments. In a word, zero-hour contracts signify monetary volatility, something which has no value to a lender.

Of course, this typifies a surface-level understanding and does not accurately portray the reality of a zero-hour contract. Thankfully, there are alternatives to mainstream lenders who possess human underwriters that can look beyond the basic nature of zero-hour contract work by inspecting the specifics of your position.

How to get a mortgage when you’re on a zero-hour contract

Whether or not you opt for a specialist lender who can offer a solution tailored to zero-hour contractors, it remains integral that you provide adequate evidence which shows that you’re not a high-risk borrower. This is true for every individual looking to get onto the property ladder, but especially so if you’re on a zero-hour contract because of the relatively unique structure of your employment. Appropriate details include:

  • Your employment history

Lenders will use your employment history as a starting point for determining your borrowing potential. Reason being, that if you’ve consistently worked in the same sector for many years, then this categorically works to inform lenders of your employment security. On the other hand, if your history exhibits substantial gaps dispersed over various sectors, or you’ve just started a new job, then this causes concern. As a general rule, lenders prefer you to have remained with the same employer for at least a year.

  • Your industry and role

In addition to your employment history, the industry in which you work, as well as your role therein, is a crucial aspect. That is, lenders are reassured if your industry is particularly active & lucrative. Likewise, if your specific role is in high demand because it requires a specialised skill or qualification in order to perform it, this will work in your favour. For example, if you’re a teacher, accountant, or practising medical professional, it’s assumed that you’re quite financially stable.

  • Your complete earnings

Obviously, a lender will need access to information regarding your annual income so as to assess your affordability, this foremostly refers to proof of income. Displaying proof of income usually entails providing up to a year’s worth of bank statements, payslips, and previous P60s. Moreover, if you possess respectable savings and strong indications of your future financial potential, this will also serve to instil confidence in lenders with respect to your financial shrewdness.

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

Your eligibility for getting a zero-hour contract mortgage is determined by a lot of factors. Alongside satisfying the previous points, you’re also required to undergo a hard credit check that is always impressed upon prospective homeowners. Again, lenders must verify that you are an individual who has a positive track record with money, i.e., that you are capable of handling it in a sensible manner. Chiefly, lenders are not permitted to distribute loans to people who can’t comfortably afford the attached monthly repayments.

It is essential for lenders to carry out a hard credit check because it makes your credit score visible. A poor credit score suggests that you have had issues in the past relating to money, whether this implies that you’ve had bad credit, failed to rectify payday loans, handled a court county judgement (CCJ), had an IVA, or have previously filed for bankruptcy. If such instances appear on your credit report, then they will contribute a negative impact upon your eligibility for a mortgage.

Because zero-hour contract mortgages are passively viewed to be of a higher risk, it would be scrupulous to rebuild your financial health before submitting an application. Applying with a high street lender for a zero-hour mortgage when you have a poor credit rating is a surefire way of wasting time and money. However, if you are desperate to own a house, then specialist mortgage brokers like us can mitigate any adverse financial past you may have by finding a specialist lender who is suited to dealing with a wide range of financial circumstances. The crux is finding a lender which corresponds to your personal situation.

It’s important to mention that hard credit checks leave a mark on your report. And so, if you want to get an idea of your current eligibility before you apply for a mortgage, you can use our free credit check tool (£14.99 per month after the free 30-day trial). Using it will help you to discern any possible mistakes or fraudulent activity on your profile, so that you can correct such problems. The trial and subscription can be cancelled at any time.

Do I need a bigger mortgage deposit if I’m on a zero-hour contract?

One certified way of negating any risk that you, as a zero-hour contract mortgage candidate, carry is by putting forward a substantial mortgage deposit. This doesn’t go to say that you absolutely have to accrue a mortgage deposit larger than normal before applying, but it will certainly help your case. This is because having a big deposit available shows that you have firm money-handling capabilities, effectively ensuring lenders of your financial stability.

The exact size of the mortgage deposit you’ll be required to put down depends entirely on your selected lender. Although, to give an example, a lender may ask for a deposit of at least between 10-25% of a property’s total value. This would land you a 90% LTV mortgage or 75% LTV mortgage, respectively. Not to mention, having access to a sizable deposit will entitle you to some of the most competitive interest rates on the market, a pertinent factor when taking into account the extra fees and changes that come with every mortgage package.

Can I get a zero-hour contract mortgage with bad credit?

Yes, as we mentioned, it is possible, albeit difficult, to get a zero-hour contract mortgage when you have bad credit. If this is specifically relevant to your circumstances, then it’s imperative that you hire a specialist mortgage broker so that you can seek out specialist lenders. We understand that there’s a story behind every adverse financial position, but mainstream lenders are often dismissive in such situations. Although the rate of interest for bad credit zero-hour contract mortgages are not the most competitive, they do exist nonetheless.

Can I get a zero-hour contract buy-to-let mortgage?

Yes, you can get a zero-hour contract buy-to-let mortgage. In fact, the process is often considerably easier than securing a residential mortgage. The primary reason for this is because purchasing a property with the intention of letting it out means that you’ll generate additional income as a direct result. And so, this potential income will act as support for your application if there are any problems. In terms of a deposit for a buy-to-let mortgage, the minimum requirement is typically 15%, i.e., an 85% LTV mortgage.

Zero-hour contract mortgage lenders

Each lender has unique criteria by which they measure every zero-hour mortgage candidate's eligibility. And, while it is possible for you to get a mortgage from a high street lender, your chances of becoming a homeowner will increase if you find a specialist lender who can provide you with a tailored solution.

Indeed, you may be able to obtain deals with the same rates as those which are offered to full-time contracted workers. In practice, the variations between lenders are quite marked, and it’s wholly in your best interests to locate a lender accustomed to your individual position. The most efficient way of achieving this is by getting in touch with a specialised mortgage broker. If you approach one of the limited lenders yourself, it’s likely you’ll be declined. Moreover, mortgage brokers can handle the entire process from beginning to end, including suitably formatting your application so that you’re guaranteed a spot on the property ladder without being extorted.

We at The Mortgage Genie have a comprehensive understanding on how to get a mortgage and are dedicated to helping people secure loans of all types, even those that require having a specialist advisor at hand. We hope that this article has answered all of the questions you might’ve had surrounding zero-hour contract mortgages.

Each day we assist an exponentially growing number of people by finding housing happiness via the ideal mortgage product for them and their financial circumstances, all while guiding them through every step of the, often complex, process. If you’re in need of a team of expert mortgage brokers, then be sure to get in touch by dialling 01915809890 and we’ll set you on the path towards owning your dream house! And why not see how much you could borrow up to today by using our mortgage calculator?

Company Information

The Mortgage Genie Limited is Registered in England and Wales with Company Number 9803176. The Mortgage Genie Limited is an Appointed Representative of PRIMIS Mortgage Network, a trading name of First Complete Ltd. First Complete Ltd is authorised and regulated by the Financial Conduct Authority. Most Buy-to-Let Mortgages are not regulated by the Financial Conduct Authority.


Depending on the complexity of your mortgage there may be a fee for our mortgage advice and arrangement service, which will be discussed and agreed before you make a mortgage application. A typical fee is £293 and will never be more than 1% of the mortgage amount.