The risks of borrowing while on probation

The obvious risk that you are taking is that if your employment is finalised during your probation period then you may be unable to make your repayments. Not everybody is in the same boat. High demand professions such as IT contractors/teachers and nurses generally have little difficulty finding a new job if their employment has been terminated.

We recommend that you think about your personal situation, assess what you believe the risks to be for you and then take action to mitigate that risk.

How can you reduce your risk?

As a mortgagor it is important to reduce your risk of defaulting on the loan. There are several ways in which you can reduce your risk:

• Having money on standby.
• Seeking income protection insurance (only covers some types of employment / loss of income).
• Discussing employment security with your boss or asking for a performance review during your trial period before seeking a loan.
• In the event you are out of work always contact your lender and make arrangements immediately. They can often approve a payment holiday for you until you are able to catch up.

Enquire online today and talk to our expert mortgage brokers who can help you to apply for a home loan.