Will you get a mortgage if you change your job?
mortgage pre approval
Will changing jobs stop you from obtainin a mortgage pre approval? If you are relocating for a new job and are applying for loan pre approval, chances are that the changes to your mortgage pre approval will be minimal. But, like everything related to mortgages, you must pay attention to the details. As long as you change your job and have the same income or a better one and you can provide documentation on your income history there’s nothing to worry about. Lenders are mostly interested to ensure that you can repay the borrowed money and they wish to know that your income is stable and foreseeable stable. The standard they must meet is that the same income holds true for the next three years.
Here is what the lenders are usually asking:
- history of training and qualifications
- do you work for someone else or are you self-employed
- overall health for the industry you are working in
- your job change frequency
- long periods of unemployment
- job gaps (off work for 30 days or more)
- Other jobs that match your payment and skills
If you are on the verge of changing your job or recently moved to a different position, there are certain aspects that might hamper your mortgage pre approval. If you were working for someone else and decide to start working for yourself, this will hamper your mortgage pre approval.
What If You Change Your Job Before Getting a Mortgage Pre Approval?
If your job is in the same industry and you are going to earn more money, lenders will be happy and they will not have any concerns. A promotion or a lateral move to a better salary in a bigger company will not make any impact on your mortgage approval.
Since your lender is interested in your ability to repay your loan, a long-term and full-time job will be optimal. Most lenders will ask for a copy of your first pay stub. You should be aware that lenders will likely omit commission earnings from your income and this is going to affect the total amount you will get.
It is important to note that if you change your job for less pay, a transition from full-time to contractor or a significant industry change may not be positive. Also, an extended gap of unemployment, longer than six months, will raise some questions.
A good approach is to rent for the first 30 days after you relocate. That will solidify being able to provide your lender the first pay stub. Assuming that you are still in the same industry and your new role is a better one, there should be no impediments to getting your mortgage pre approval in a short amount of time. Another good solution is to close the purchase of the house in the new location before notifying your current employer. This will allow for a smooth move.
Another feasible way to pre-purchase before you move would be to secure a job offer letter from the new employer. The job offer letter should be on their letterhead, signed and dated. The offer should contain important info like your anticipated or approximate start date, your anticipated salary, any other benefits. You should sign your job offer letter indicating acceptance. From that point, Verbal verifications with the future employer will solidify your employment.
We advise you to carefully take in consideration the timelines.
Usually, a purchase takes from 30 to 45 days and lenders verify your employment status twice... Once during processing of the application and once just before closing. Make sure to maintain your employment status until you close the sale. Always discuss any possible planned changes to your employment with your loan officer.
You could be selling your existing property & using the proceeds for the cash for the down payment. By doing this, you will increase the chances of your mortgage approval. Down Payment is one piece of the puzzle to mortgage pre approval.
When buying a new home, keep in mind that lenders are looking for long-term and steady employment. A radical industry change or multiple lateral moves within the same industry are not a sign of progress. Instead, moving from an intern to a manager position makes sense. Just keep in mind that the lender will issue a loan at a fixed rate for the next 30 years. What do you think he will be happy to see?
Here at All Western Mortgage, we understand that mortgages aren't a one size fits all solution. Casey Moseman can help you find the right lender. She will factor in a number of lifestyle and financial variables. Then she can recommend several suitable home loans from our lenders. You can then choose the mortgage that's exactly right for you.
A professional such as Casey understands the Las Vegas mortgage market and has knowledge of the industry. Furthermore, her background will help to ensure a stress-free and speedy home buying experience for you.