Early Career Teacher MortgagesGuide
The definitive guide to getting Early Career Teacher (ECT) Mortgages.
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Can Early Career teachers get a mortgage?
Getting an Early Career Teachers Mortgage can be difficult. There are a few factors to consider.
Firstly, you are usually on a fixed term teaching contract. This means that some lenders will treat you as a contractor. However, some lenders understand being an ECT (Formally Newly Qualified Teacher (NQT))
Secondly, you have less employment history. This is because you were likely doing your Initial Teacher Training in the previous year.
Can I get a mortgage as an ECT teacher?
Teachers in their first few years can get a specialist ECT Mortgage which will be with a lender that offers specialist criteria allowing for your unique circumstances.
An ECT Mortgage will usually offer similar rates as a standard mortgage, however, most lenders don’t allow an ECT to apply. Therefore, an ECT mortgage can be used to allow a Newly qualified teacher to be approved.
Do Teachers get better Early Career Teacher / ECT Mortgage rates?
Whilst Early Career Teacher (ECT) Mortgages are essential for Newly Qualified or Early Career Teachers, it doesn’t necessarily mean you will get better rates of interest.
Generally when we talk about Mortgages for Teachers they have specialist criteria or affordability that is beneficial for Early Career Teachers Mortgages.
There are several lenders that offer Early Career Teacher (ECT) Mortgages, including Teachers Building Society. However, some generally offer a better rate of interest than others/
Do Teachers get special mortgages?
Early Career Teachers can potentially get special mortgages. These may allow them to borrow more, or offer a better rate of interest potentially.
However, for the most part, ECT Mortgages allow you to get a mortgage where most lenders wouldn’t allow it.
Most lenders do not offer ECT Mortgages due to the fixed term contract in the first year. This is incredibly common. However, we have access to a few lenders that do allow an ECT Mortgage.
Are there specialist lenders for an Early Career Teachers Mortgage?
There are specialist lenders and products for Teachers. However, most of these aren’t available for Early Career Teacher Mortgages.
ECT Mortgages tend to be standard mortgages that allow for the fixed term contract and lack of employment history that an ECT will find themselves having.
Types of Early Career Teacher Mortgages
Fixed Rate Mortgages
Fixed Rate mortgages tend to offer Early Career Teachers products where the rate of interest if fixed for a set amount of time. This means that your monthly payments will remain the same for that period as well.
They tend to have something called an Early Repayment Charge that will mean if you try and pay off the mortgage during the fixed rate period you have to pay a fee.
Variable Rate Mortgages
Variable rate mortgages tend to vary from month to month based on either the Bank of England base rate or the lenders standard variable interest rate. This means that your monthly payments can potentially go up and down depending on what is happening to those rates.
These mortgages tend to not have Early repayment charges, making them a bit more flexible.
Getting a mortgage during your NQT year
You may hear about getting a mortgage during your NQT year. An NQT Mortgage is the same as an ECT Mortgage.
Prior to 2021, most Early Career Teachers were referred to as Newly Qualified Teachers. At Teacher Mortgages we have always specialised in Early Career Teacher Mortgages. When you speak to one of our Specialists we may refer to Newly Qualified Teacher Mortgages or NQT Mortgages, but this is the same as an ECT Mortgage.
Getting an Early Career Teacher Mortgage with Bad Credit
Having bad credit can obviously affect your options for getting an ECT Mortgage. However, even with bad credit you still have options as an Early Careers Teacher Mortgage.
Generally when you have bad credit as an ECT it will come down to a few factors:
- How long ago it was – Depending on how long ago your bad credit was, it may no longer be as big a deal.
- How much it was – The value can often be really important with a mortgage. If it is smaller, that is usually better.
- What it was for – Was it for a loan? Or a phone agreement? Some things are worse than others.
- Is it satisfied? – Lenders usually require debts that have defaulted to have been paid off.
Using a Specialist Teacher Mortgage Broker
At Teacher Mortgages we specialise in all things to do with Teacher Mortgage Advice. From doing your Initial Teacher Training all the way through to Early Careers Teachers and beyond.
Using a specialist Teacher Mortgage broker can help get the Early Career Teacher mortgage you need.
Early Career Teacher Mortgages schemes
There are various schemes available for Early career teacher Mortgages. Below we give some examples of schemes you may be able to use for an ECT Mortgage, to help buy a home.
- Shared Ownership Scheme – This is very popular for Early Career Teacher Mortgages as it allows you to part buy and part rent your home. This can therefore mean that you can buy your home with a smaller deposit or smaller income. This is particular beneficial for Early Career Teacher Mortgages as your income should grow steadily over time which will allow you to buy more shares of your home.
- Joint Borrower Sole Proprietor scheme – This scheme allows you to add a person to your mortgage for affordability but they wouldn’t be on the ownership of the property. This therefore means you can usually increase the amount you can borrow.
- First Homes – First homes is not widely available, however, if you can find one is a very good scheme. Aimed at First time buyers and key workers, it gives a minimum 30% discount of the purchase price of an eligible new build property. Whilst not widely available, it can be the perfect scheme for Early Career Teacher Mortgages if you can find one.
- Right to buy – Whilst not widely an ECT mortgages scheme, it could be useful. Essentially this scheme allows you to buy your council or local authority owned property at a discount and usually without a deposit.
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