Home Loan Employment Confirmation Letter

Since the Royal Commission kicked off in April banks & lenders have really cracked down on documentation requirements for all home loan applications. This means that you may be asked to provide a Letter Of Employment for a mortgage application.

In this blog, I will walk you through all you need to know about home loan employment confirmation letters and I’ll even give you a template.

Why Do You Need To Provide A Employment Confirmation Letter?

Banks & lenders need to verify your income to be satisfied that you can afford the proposed home loan that you are applying for. Generally speaking, your payslips, ATO Notice of Assessment, Tax Return or PAYG Summaries are enough, however in today’s tightening credit market don’t be surprised if your lender asks you for an Employment Confirmation Letter.

This letter will need to be supplied by your employer and should follow a basic format. It’s important that the letter is signed by your employer and appears on their official letterhead.

Here is a simple template your employer could follow to help you with your employment confirmation letter:

14/12/2018

To Whom It May Concern,

I am writing to you in response to your request for an Employment Confirmation Letter for Joe Bloggs.

I am pleased to confirm that Joe Bloggs has been employed at XYZ Company since 1st January 2014. He has been employed on a full-time/part-time/casual basis during this time and his current salary is $100,000. He is not on probation and we do not foresee any changes to his employment for the foreseeable future.

If you require any further confirmation or would like to discuss this letter further, please contact me on (02) 9600 0000.

Yours Sincerely,

(SIGNED)

Employer Representative’s Name (e.g. Jane Doe)

Position Title

Company

Contact Details

You can always download our template to make it easier and faster for both you & your employer.

Click here to download.

Important Requirements For An Employment Confirmation Letter

Nearly every lender has a specific list of requirements for employment confirmation letters. If you follow this list, you should avoid any unnecessary delays.

• Make sure that the letter is presented on a company letterhead.
• Your employers ABN must be included somewhere in the letter – either in the letterhead or the body of the letter.
• The letter needs to be dated.
• It MUST be signed (I had one person try and send us an unsigned letter… that simply will be rejected and unnecessary delays will be experienced)
• It must be detailed enough so that the lender will not be left with any questions (follow our template for guidance)
• Covers all the details of your employment arrangement:
  • Length of employment
  • Start date
  • Employment status (full-time/part-time etc)
  • Income
  • Whether any changes are foreseen
  • If you’re returning from maternity leave, the exact date of your return, your working arrangements, and salary upon your return

Need Help?

Chances are that if you’re reading this, then you have already approached a bank to discuss your home loan. One thing I do urge you to consider is that if you have gone directly to your bank, then you may not be getting the most appropriate lending options for your personal circumstances and objectives. Your bank can’t tell you about other lender’s options… whereas a mortgage broker can.

If you’re already working with a mortgage broker, that’s great. I’m sure they’re looking after you and have probably already given you a template like this.

If you’re not currently working with a broker, then feel free to get in contact with us and we’ll be more than happy to see whether we’d be the right fit for you. Don’t worry, if we’re not a good fit, we have plenty of highly experienced and qualified brokers that I have personally vetted that may be a better option for you.

Author: Shane