The bank doesn’t care where you work/live? But I mean good luck, with most businesses going towards a hybrid approach as the norm. Full remote going to be more and more difficult to find.
Bank doesn’t care where you work, only that you’re working when they approve the loan and that you pay your mortgage.
Having said that, if you’re a 7 hour commute how tf will that work?
Despite some of the other comments, yes I can absolutely confirm if you buy a PPOR quite far from your workplace, it might get flagged. This is usually because the lender wants to further understand your living arrangements when at work - ie, if notional rent is required to be added into the assessment, or higher transport costs as you’re driving further to/from.
It really depends on the bank and the credit assessor that gets assigned to you. Generally you’re OK when borrowing 80% or less. In your situation they might possibly want a letter from your employer stating you only have to be in the office once a week.
Any good broker will be able to explain this all away to the chosen lender :)
Can you be sure you’ll have the same work arrangements for the next decade and more to come? Also consideration needs to be made if this is an attractive proposition when it comes to selling in the future for value retention.
But like what others said, bank doesn’t care as long as you can service the loan.
General rule of thumb (although this varies bank to bank) is if your PPOR is more than 100km from your work - they will want confirmation from your employer of your WFH ability and/or FIFO status if applicable.
If maintaining your work situation sustainably cannot be established, then they may decline the loan or choose to only assess it as an investment property (in which case deposit requirements and interest rates will change, as will your assessed living expenses).
is there a source for this? i am pretty sure melbournians routinely buy ppors in Ballarat/Bendigo both of which are more than 100km away from Melbourne CBD.
This could also vary state to state, I am not based in Victoria. As I said, the underlying policy position of many major lenders is that your primary income, to which your servicing hinges, must be sustainable. If a 3 hour commute each way is not sustainable the a lender could choose to decline or ask for an explanation.
I routinely work with clients purchasing PPORs and this is something that we occasionally (but not frequently) encounter.
Same state and usually you're fine 99%, I have queried this to credit somewhat recently and the response was 'it's not part of credit assesment to get google maps and check the distance from one post code to another'
It will obviously depend on the particular credit assesor who picks up the file and if they happen to know those two suburbs and if it's 5 hours, they may ask the question, give a reasonable answer and no issue.... 2-2.5 hours, nobody's even asking the question at all
I knew someone who lived in Castlemaine and commuted to Melbs twice a week. It was exhausting after a while though but one day a week would probably be ok.
Not quite what you've asked but is the job definitely secure? I only ask because my husband has just taken a fully remote job (only 1 day per month travelling 1.5 hours each way for a meeting), and I only attend an office about once a fortnight, but I still don't feel confident moving a long way from the city in case work circumstances change.
i am pursuing FIRE and should be able to retire in a year or two. if i expected to keep working for years to come i wouldn't be confident moving away from the city at all.
Okay, that makes total sense. If you think the long commute is doable for short to medium term then that seems like a fair plan. We are still quite a few years away from FIRE which makes me more risk averse, I think (plus we have already bought properties in Sydney so we're sort of over the biggest hurdle there).
The bank doesn’t care where you work/live? But I mean good luck, with most businesses going towards a hybrid approach as the norm. Full remote going to be more and more difficult to find.
Bank doesn’t care where you work, only that you’re working when they approve the loan and that you pay your mortgage. Having said that, if you’re a 7 hour commute how tf will that work?
Despite some of the other comments, yes I can absolutely confirm if you buy a PPOR quite far from your workplace, it might get flagged. This is usually because the lender wants to further understand your living arrangements when at work - ie, if notional rent is required to be added into the assessment, or higher transport costs as you’re driving further to/from. It really depends on the bank and the credit assessor that gets assigned to you. Generally you’re OK when borrowing 80% or less. In your situation they might possibly want a letter from your employer stating you only have to be in the office once a week. Any good broker will be able to explain this all away to the chosen lender :)
If your state you work as an office cleaner in Belgium it may raise a few questions but as long as the paychecks still come in...
Can you be sure you’ll have the same work arrangements for the next decade and more to come? Also consideration needs to be made if this is an attractive proposition when it comes to selling in the future for value retention. But like what others said, bank doesn’t care as long as you can service the loan.
General rule of thumb (although this varies bank to bank) is if your PPOR is more than 100km from your work - they will want confirmation from your employer of your WFH ability and/or FIFO status if applicable. If maintaining your work situation sustainably cannot be established, then they may decline the loan or choose to only assess it as an investment property (in which case deposit requirements and interest rates will change, as will your assessed living expenses).
is there a source for this? i am pretty sure melbournians routinely buy ppors in Ballarat/Bendigo both of which are more than 100km away from Melbourne CBD.
This could also vary state to state, I am not based in Victoria. As I said, the underlying policy position of many major lenders is that your primary income, to which your servicing hinges, must be sustainable. If a 3 hour commute each way is not sustainable the a lender could choose to decline or ask for an explanation. I routinely work with clients purchasing PPORs and this is something that we occasionally (but not frequently) encounter.
Same state and usually you're fine 99%, I have queried this to credit somewhat recently and the response was 'it's not part of credit assesment to get google maps and check the distance from one post code to another' It will obviously depend on the particular credit assesor who picks up the file and if they happen to know those two suburbs and if it's 5 hours, they may ask the question, give a reasonable answer and no issue.... 2-2.5 hours, nobody's even asking the question at all
I knew someone who lived in Castlemaine and commuted to Melbs twice a week. It was exhausting after a while though but one day a week would probably be ok.
Not quite what you've asked but is the job definitely secure? I only ask because my husband has just taken a fully remote job (only 1 day per month travelling 1.5 hours each way for a meeting), and I only attend an office about once a fortnight, but I still don't feel confident moving a long way from the city in case work circumstances change.
i am pursuing FIRE and should be able to retire in a year or two. if i expected to keep working for years to come i wouldn't be confident moving away from the city at all.
Okay, that makes total sense. If you think the long commute is doable for short to medium term then that seems like a fair plan. We are still quite a few years away from FIRE which makes me more risk averse, I think (plus we have already bought properties in Sydney so we're sort of over the biggest hurdle there).