When buying a Gulf Shores home, obviously a job is an important cog in the wheel to obtaining a mortgage. But the lending game is full of misconceptions about job gaps, job changes and occupational changes within the course of an employment time frame. Yes, you CAN get a mortgage if you switched jobs or even changed industries, you just have to approach it the right way to get the deal approved.
When determining your ability to pay (and therefore determining how much Gulf Shores home you can afford to buy), a lender will calculate your average income based on your pay from the past 24 months. It's pretty straightforward and simple if you've had the same job and same income and pay structure, but if any of those things changed in the past two years — or will change soon, you may face challenges when trying to get a mortgage.
Don't Change Jobs When Buying A Gulf Shores Home
In the past, lenders were ready to refuse loan applications where there was a job or industry change. We even tell prospects looking at buying a Gulf Shores home not to change jobs before applying for their home loan. While this is the case for most situations, it is not necessarily so black-and-white.
If you've had a job change, no matter what, a lender is going to need the following things from you — and your employer — in order to close on a mortgage: an offer letter, a role change letter if you have a title change and commensurate compensation package change, and the most recent pay stub and verification of employment.
If you can't provide a pay stub with year-to-date income (usually a 30-day pay stub depending on your specific lender's requirement), along with a letter detailing the change, you likely won't get approved for the loan. Let's say, for example, you are looking at buying a Gulf Shores home and you know in the next four months your income is going to increase to $6,000 per month because you'll have a new role within your company. In order for that $6,000 per month income to be used in the calculation, you'll have to get the details of the raise, including the role change letter and at least one pay stub.
So if you are thinking about getting a mortgage, even if it is further down the road, consider starting discussions with a lender now so you can be guided through any income bumps the past or future may hold. It is especially critical for homebuyers to get pre-approved with a lender upfront prior to house-hunting. This process includes allowing a lender to review your credit, debt, income and assets to assess your ability to qualify. When buying a Gulf Shores home, being pre-approved greatly increases your chances of getting a yes from a seller.
This is also a good time to start looking over your credit reports and checking your credit scores so you can address any problems in advance of applying for a mortgage.
Stay abreast of all the tips and tricks affecting your ability to obtain a mortgage and buying a Gulf Shores home here at our website. More articles regarding Gulf Shores mortgages can be found by clicking on the Gulf Shores Mortgage Info link to your right under Gulf Shores Real Estate Categories.