Zero hour contracts reach record high

Nearly a million people working in the UK are now on zero hour contracts. There were 110,000 more people on zero hours contracts in the second half of 2016 compared to the same period last year, according to figures from the Office for National Statistics. In total, there are now 910,000 people on this type of contract. With a zero hours contract, employers offer work when it is needed, but there is no guarantee of regular income, which means wages can fluctuate from month to month. Although the rate of increase for such contracts has slowed, the numbers on zero hour contracts are now at a record high. Numbers rose much faster following the financial crisis when many employers needed to reduce costs, and more employees worried about job security were prepared take on roles on a casual basis to stay in work. Lenders are often cautious about offering mortgages to homebuyers on this type of contract, as they need to see proof of income to ensure that they will be able to make their monthly mortgage payments on time. Although lenders can be wary about accepting mortgage applications from workers on zero hours contracts, increasingly lenders are adapting their policies to take account of the growing numbers of people on this type of contract. Each lender will have its own different criteria, but your chances of being accepted for a mortgage will be higher if you can supply records showing that you’ve worked on this basis for 12 months or more. Those that have changed to this type of contract more recently will find securing a mortgage more of a struggle, so building up a track record over time before applying will help increase the chances of success.