Financing in San Jose>Question Details

Rocketdude, Home Buyer in San Jose, CA

Can I qualify for a mortgage with a part time job, or a contract position?

Asked by Rocketdude, San Jose, CA Sun Jul 1, 2012

I'm in a bit of a unique position. I recently qualified for a mortgage based on a full-time job. However, I didn't buy anything and I just left the job. My industry is very hot right now and I have a great offer for a 6 month contract position - either 40 or 20 hours a week, up to me. I also have an offer for a part-time employment position and could combine the two. Either way, the total income would be higher than my previous FT job.

Is it possible to qualify for a mortgage with the 6 month contract at 40 hours a week? Or would I be in a stronger position if I contracted 20 hours a week and combined it with the part-time job?

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Answers

7
Rocketdude:
If you normally contract, and have a two year history as a contractor rather than W-2, then you are in like Flynn. If this is your first contract and you have been W-2 up until now, then you need to explain that contract is a normal option in your line of work. If you have no over one month employment gaps, then you should be okay if the forgoing is played right. If you have more questions, hyou can contact me at 408-639-0211.
Mitchell Pearce
mitchell@handsonrealtor.com
408-639-0211
1 vote Thank Flag Link Sun Jul 1, 2012
It is true that you must document 2 years of contract work to qualify as income.
We could use your part time position and demonstrate that you chose to take a part time postion so that you could take advantage of the contract position. The income cannot be used to qualify.

Let me know if you have any questions. cg
0 votes Thank Flag Link Sun Jul 1, 2012
Hello,

Unfortunately you won't qualify for a mortgage due to your current employment situation. As a contractor, you must have at least two years in the business (as a contractor, cannot combine with the time you worked as wage earner). In order to use the part time income, you must work at that job for at least one year. However, if you switch back to wage earner now, you can still qualify for your mortgage eventhough you have a gap in between as contractor.
0 votes Thank Flag Link Sun Jul 1, 2012
I recommend you talk with your mortgage professional or I have a great person to refer you too.

If you are debating between the two scenarios and buying a house is important talk to my mortgage guy right away. This way you can make an informed decision for your ultimate goal.

Have an amazing day.

BTW:

Dave Setti
Turnkey Mortgage
http://www.davidsetti.com
408-377-8876
Web Reference: http://www.terrivellios.com
0 votes Thank Flag Link Sun Jul 1, 2012
Yes, you may be able to qualify but you will have to talk to a loan broker. I would start with whoever qualified you in the first place. That may be your easiest option.
0 votes Thank Flag Link Sun Jul 1, 2012
Rocketdude,

It sounds like you are currently not working. Not knowing all the personal circumstances about your application (down payment, reserves) or whether the part time position is in the same line of work, I would not be able to say for sure you would not have a problem.

The banks want to see a 3 year continuance of income that is not W2. You may have a problem qualifing with a 6 month contract and part time income even though it is more. If you regularly take contract jobs, it may not be a problem. Either way, you should contact your loan officer who pre-approved you to let them know of the changes.

If your loan officer is not able to help you, I would be happy to review your entire application.

Michelle
0 votes Thank Flag Link Sun Jul 1, 2012
Rocketdude,

The best answer to your question should come from a mortgage professional who can review all of your personal circumstances pertaining to your potential mortgage qualifications.

The purchase of a home is a big deal and requires a long term commitment. I would plan on a minimum of five years holding time in order to see hoped for equity growth. Your instability as evidenced by having left your full time job and your ambivalence about accepting replacement employment might be worrisome to a lender. On the other hand, job change for advancement in the Silicon Valley employment arena is normal. In many areas, the notion of long term employment with the same employer is quaint.

You need an experienced mortgage professional to review your entire situation. You can go back to the one who provided your previous approval, friends can recommend mortgage pros with which they have worked or send me a note and I will provide the contact information for my favorite mortgage professional.
0 votes Thank Flag Link Sun Jul 1, 2012
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