Ned Mahoney's Blog
It’s always a goal in life to be happier in our jobs and make more money. When it comes to buying a home, your job status can have a big effect on whether or not you’ll be able to buy a home or not. You will be able to buy a home using a new source of income. Even refinancing can be a breeze when you have a new job and the right knowledge.
Many people believe that changing jobs or having gaps in between employment is a certain type of black hole when it comes to getting a mortgage. However, if you approach all of the changes in the correct way, you should be able to land the mortgage deal and secure a home.
One of the most important numbers that your lender will calculate when you’re buying a home is that of your average income. This will be based on the pay that you had earned in the past 24 months‘ time. If you have had the same job and pay, this won’t be much of a big deal, However, if any of these things have changed (or will soon change) your lender may have some questions. This doesn’t mean that your mortgage application will be struck down completely.
Information That’s Needed In The Event Of A Job Change
If you have recently changed jobs in the process of trying to refinance or buy a new home, your lender will need a few pieces of information from you. These items include:
- An offer letter for the job
- A role or title change letter (if applicable)
- Compensation package change confirmation
- Verification of employment
- Most recent pay stub
If you’re an hourly employee, unfortunately, you’re under the tightest type of scrutiny when it comes to applying for a mortgage. Your income will be averaged for as long as you have been an hourly employee. If you work full-time, this won’t be too much of a problem. If your hours fluctuate from week-to-week, this can make things a bit more complicated.
If your hourly rates have recently gone up, you’ll need a bit of info from your employer to help you get the income verification that your lender needs. These items include:
- An offer letter
- Recent pay stubs
- The new compensation structure or offer
If you have any sort of extenuating circumstances like a relocation or a new position, this information can help to bridge the gap in any information that just doesn’t add up as far as your employment history goes.
If you’re a salaried employee, things are a bit simpler. Your lender will have a much easier time calculating your average income. The only issue that you may encounter is if you have had a gap in employment. For this, your lender will require a written explanation of what occurred during that time period.
Lenders want to protect themselves, but in a way, they also want to protect you from getting in over your head with how much you can afford for a home. With some proof and a little explanation, you should be able to get a house you can afford if you have all of the information that you need to back up your financial history and employment history.