Buying a new home requires a lot of vetting on behalf of lenders which translates to quite a bit of work on your end to provide documentation proving your financial situation. Lenders are largely looking at both how willing you are and how able you are to repay your mortgage, and naturally they look to your employment both from a historical context and a future outlook.
We’ve discussed in other blogs that you shouldn’t switch jobs while trying to get a mortgage, but what about starting a new job before you start the process? Let’s take a look.
Changes at a Glance
Job changes alone are stressful. Couple that with the home buying process, and you can find yourself a little frazzled. Fortunately, starting a new job while trying to buy a house isn’t doom and gloom and your lender likely doesn’t have a “one size fits all” method for approving a mortgage.
Lenders will likely look at both your past employment history as well as you future income and employment longevity as factors to get your mortgage moving. What’s important is to keep calm about changes to your employment and keep a very clear line of communication between you and your lender.
If you’re a first time homebuyer and you’re just getting started in your career, then you may not have a long list of employment history to back up your position as a buyer. What do you do to prove that you’re a worthy borrower?
First off, your lender has plenty of resources to research your particular line of work, look at longevity, and also view potential income down the road. You, on the other hand, have the resource of your employer and your own character. A letter of reference or recommendation from your employer or human resources department can really help you establish your position.
Hedging Employment Changes
Sometimes you can’t necessarily prove that you’ll remain in your work position or perhaps your lender is looking for more job security. In the event that your lender is looking for a little more from your employment situation, then make sure you’ve got adequate collateral or a substantial downpayment to offset those lender demands.
You likely already have a downpayment prepared if you’re in the market for a home, but you may need to prove a greater collateral position or increase what you plan to put down to offset any employment shortcomings. Depending on your job situation, maybe a few months worth of savings can make a difference to your lender.
Get Started Today
With so many considerations to take into account when buying a home, getting started sooner rather than later will benefit you as the mortgage process begins in earnest. With so much preparation involved and paperwork, it will benefit you to get started with the process several months out from your purchase date.
If choosing a lender is getting you down or if you just need some direction on the lending side, then get in touch with Tidewater Mortgage Services Inc. Over 20 years of experience in the mortgage business has established Tidewater as one of the leaders in helping first time homebuyers get into the homes of their dreams.